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The Political Economy of Higher Education Finance: How Information and Design Affect Public Preferences for Tuition

Author

Listed:
  • Lergetporer, Philipp

    (ifo Institute at the University of Munich; CESifo)

  • Woessmann, Ludger

    (: University of Munich and ifo Institute; CESifo, IZA, and CAGE)

Abstract

Public preferences for charging tuition are important for determining higher education finance. To test whether public support for tuition depends on information and design, we devise several survey experiments in representative samples of the German electorate (N>19,500). The electorate is divided, with a slight plurality opposing tuition. Providing information on the university earnings premium raises support for tuition by 7 percentage points, turning the plurality in favor. The opposition-reducing effect persists two weeks after treatment. Information on fiscal costs and unequal access does not affect public preferences. Designing tuition as deferred income-contingent payments raises support by 16 percentage points, creating a strong majority favoring tuition. The same effect emerges when framed asloan payments. Support decreases with higher tuition levels and increases when targeted at non-EU students.

Suggested Citation

  • Lergetporer, Philipp & Woessmann, Ludger, 2019. "The Political Economy of Higher Education Finance: How Information and Design Affect Public Preferences for Tuition," CAGE Online Working Paper Series 405, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:405
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    tuition; higher education; political economy; survey experiments; information; earnings premium; income-contingent loans; voting JEL Classification: I22; H52; D72; D83;

    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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