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Tuition Fees, as User Prices, and Private Incentives

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  • George Economides
  • Apostolis Philippopoulos
  • Stelios Sakkas

Abstract

This paper studies the aggregate and distributional implications of introducing tuition fees for public education services into a tax system with income and consumption taxes. The setup is a neoclassical growth model where agents differ in capital holdings. We show that the introduction of tuition fees (a) improves individual incentives to work and/or save and (b) can be both efficient and equitable. The focus is on the role of tuition fees as an extra price and how this affects private incentives.

Suggested Citation

  • George Economides & Apostolis Philippopoulos & Stelios Sakkas, 2016. "Tuition Fees, as User Prices, and Private Incentives," CESifo Working Paper Series 5991, CESifo.
    • Handle: RePEc:ces:ceswps:_5991
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    More about this item

    Keywords

    user prices; tax mix; efficiency; equity;
    All these keywords.

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • D60 - Microeconomics - - Welfare Economics - - - General

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