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The Distributional Impact of Subsidies to Higher Education - Empirical Evidence from Germany

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Abstract

This paper presents empirical evidence on the distributional impact of public higher edu- cation through analysis of a cross-sectional view of West Germany in 1997. In contrast to a widely-held hypothesis in economics, our findings do not show evidence for a regressive im- pact. The use of a net-transfer calculation clearly provides a progressive distributional effect of the benefits from subsidization - at least when viewed in the cross-sectional perspective. The decisive factors are (1) the general social stratification within and among the adjusted income deciles and (2) the incidence of the granted benefits. Complementary to the existing widespread literature in this field, we propose the BCa-bootstrap procedure in order to perform statistical inference.

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  • Salvatore Barbaro, 2002. "The Distributional Impact of Subsidies to Higher Education - Empirical Evidence from Germany," Departmental Discussion Papers 114, University of Goettingen, Department of Economics.
  • Handle: RePEc:got:vwldps:114
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    1. Salvatore Barbaro, 2002. "The Distributional Impact of Subsidies to Higher Education - Empirical Evidence from Germany," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 59(4), pages 458-458, December.
    2. Andreas Haufler & Michael Pflüger, 2004. "International Commodity Taxation under Monopolistic Competition," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 6(3), pages 445-470, August.
    3. Johann Graf Lambsdorff & Sitki Utku Teksoz, 2002. "Corrupt Relational Contracting," Departmental Discussion Papers 113, University of Goettingen, Department of Economics.
    4. Sieg, Gernot, 2001. "A political business cycle with boundedly rational agents," European Journal of Political Economy, Elsevier, vol. 17(1), pages 39-52, March.
    5. Haufler, A. & Schjelderup, G. & Stahler, F., 2000. "Commodity Taxation and International Trade in Imperfect Markets," Papers 17/00, Norwegian School of Economics and Business Administration-.
    6. Blaug, Mark, 1982. "The distributional effects of higher education subsidies," Economics of Education Review, Elsevier, vol. 2(3), pages 209-231, June.
    7. Salvatore Barbaro, 2003. "The Combined Effect of Taxation and Subsidization on Human Capital Investment," Departmental Discussion Papers 116, University of Goettingen, Department of Economics.
    8. Onozaki, Tamotsu & Sieg, Gernot & Yokoo, Masanori, 2000. "Complex dynamics in a cobweb model with adaptive production adjustment," Journal of Economic Behavior & Organization, Elsevier, vol. 41(2), pages 101-115, February.
    9. Christoph Sauer & Margit Schratzenstaller, 2002. "Strategies Of International Fiscal Competition For Foreign Direct Investment In A Model With Impure Public Inputs," Departmental Discussion Papers 115, University of Goettingen, Department of Economics.
    10. Tim Krieger, 2001. "Intergenerational Redistribution and Labor Mobility: A Survey," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 58(3), pages 339-339, July.
    11. Jens Suedekum & Peter Ruehmann, 2003. "Severance Payments and Firm-specific Human Capital," LABOUR, CEIS, vol. 17(1), pages 47-62, March.
    12. Jens Südekum, 2001. "Home Goods and Regional Price Indices: A Perspective from New Economic Geography," Departmental Discussion Papers 109, University of Goettingen, Department of Economics.
    13. Onozaki, Tamotsu & Sieg, Gernot & Yokoo, Masanori, 2003. "Stability, chaos and multiple attractors: a single agent makes a difference," Journal of Economic Dynamics and Control, Elsevier, vol. 27(10), pages 1917-1938, August.
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    Cited by:

    1. Salvatore Barbaro & Jens Südekum, 2004. "Reforming a complicated income tax system: The political economics perspective," Departmental Discussion Papers 120, University of Goettingen, Department of Economics.
    2. Alessandro Cigno & Annalisa Luporini, 2009. "Scholarships or Student Loans? Subsidizing Higher Education in the Presence of Moral Hazard," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 11(1), pages 55-87, February.
    3. Petra Enß & Robert Schwager, 2006. "Kommunaler Finanzausgleich und Gewerbesteuerhebesätze in Niedersachsen," Departmental Discussion Papers 127, University of Goettingen, Department of Economics.
    4. Salvatore Barbaro, 2002. "The Distributional Impact of Subsidies to Higher Education - Empirical Evidence from Germany," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 59(4), pages 458-458, December.
    5. Corinna Ahlfeld, 2009. "The scapegoat of heterogeneity - How fragmentation influences political decisionmaking," Departmental Discussion Papers 143, University of Goettingen, Department of Economics.
    6. Jens Suedekum, 2006. "Concentration and Specialization Trends in Germany since Re-unification," Regional Studies, Taylor & Francis Journals, vol. 40(8), pages 861-873.
    7. Sascha Becker & Robert Fenge, 2005. "Gerechtigkeit und Effizienz nachgelagerter Studiengebühren," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 58(02), pages 16-22, January.
    8. Vincent, VANDENBERGHE & Olivier, DEBANDE, 2004. "Financing Higher Education with Students Loans - The crucial role of income-contingency and risk pooling," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2004036, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    9. Salvatore Barbaro, 2004. "Tax Distortion, Countervailing Subsidies and Income Redistribution," Departmental Discussion Papers 121, University of Goettingen, Department of Economics.
    10. Sascha Wolff, 2006. "Migration und ihre Determinanten im ost-westdeutschen Kontext nach der Wiedervereinigung: Ein Literaturüberblick," Departmental Discussion Papers 130, University of Goettingen, Department of Economics.
    11. Frank Kupferschmidt & Berthold U. Wigger, 2006. "Öffentliche versus private Finanzierung der Hochschulbildung: Effizienz- und Verteilungsaspekte," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 7(2), pages 285-307, May.
    12. Renate Ohr, 2009. "European Monetary Union at Ten: Had the German Maastricht Critics Been Wrong?," Departmental Discussion Papers 141, University of Goettingen, Department of Economics.
    13. Salvatore Barbaro, 2003. "The Combined Effect of Taxation and Subsidization on Human Capital Investment," Departmental Discussion Papers 116, University of Goettingen, Department of Economics.
    14. Thies Büttner & Robert Schwager, 2003. "Regionale Verteilungseffekte der Hochschulfinanzierung und ihre Konsequenzen," Departmental Discussion Papers 119, University of Goettingen, Department of Economics.

    More about this item

    Keywords

    Higher Education Funding; Income Distribution;

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

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