IDEAS home Printed from https://ideas.repec.org/p/ieb/wpaper/doc2013-34.html
   My bibliography  Save this paper

Financing higher education: a contributory scheme

Author

Listed:
  • David Flacher

    (CEPN - CNRS (UMR 7234) Université Paris 13)

  • Hugo Harari-Kermadec

    (IDHE - CNRS (UMR 8533) ENS Cachan)

  • Léonard Moulin

    (CEPN - CNRS (UMR 7234) Université Paris 13)

Abstract

In this paper, we study the higher education financing based on the classical contributory versus self-funded pension funding scheme. We provide a brief discussion of how a system based on student debt can be seen ’funded’ and why it fails to ensure equity and efficiency and funding for the longer term. We also define a contributory financing scheme for higher education based on income tax and social security contributions, and study its strengths and weaknesses. By contributory, we mean a scheme that ensures free access to university, providing for students’ expenses and the costs of research and teaching. We show that such a system would be efficient and equitable, and we discuss under what conditions it would be efficient. We show also that it would prevent polarization in the higher education system. We conclude with an implementation of our contributory financing scheme in the case of France (it increases university funding by €5bn and provides €19bn for students’ expenditure) and illustrate the effect of such a scheme on some typical households.

Suggested Citation

  • David Flacher & Hugo Harari-Kermadec & Léonard Moulin, 2013. "Financing higher education: a contributory scheme," Working Papers 2013/34, Institut d'Economia de Barcelona (IEB).
    • Handle: RePEc:ieb:wpaper:doc2013-34
    as

    Download full text from publisher

    File URL: http://ieb.ub.edu/wp-content/uploads/2018/04/2013-IEB-WorkingPaper-34.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
    2. Gruber, Jonathan, 1997. "The Incidence of Payroll Taxation: Evidence from Chile," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages 72-101, July.
    3. Pierre Courtioux, 2009. "Peut-on financer l'éducation du supérieur de manière plus équitable ?," Working Papers hal-00370094, HAL.
    4. Magali Beffy & Denis Fougère & Arnaud Maurel, 2009. "L’impact du travail salarié des étudiants sur la réussite et la poursuite des études universitaires," Économie et Statistique, Programme National Persée, vol. 422(1), pages 31-50.
    5. Erica Field, 2009. "Educational Debt Burden and Career Choice: Evidence from a Financial Aid Experiment at NYU Law School," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 1-21, January.
    6. Haroon Chowdry & Lorraine Dearden & Alissa Goodman & Wenchao Jin, 2012. "The Distributional Impact of the 2012–13 Higher Education Funding Reforms in England," Fiscal Studies, Institute for Fiscal Studies, vol. 33(2), pages 211-235, June.
    7. Kane, Thomas J, 1994. "College Entry by Blacks since 1970: The Role of College Costs, Family Background, and the Returns to Education," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 878-911, October.
    8. Barr, Nicholas, 1993. "Alternative Funding Resources for Higher Education," Economic Journal, Royal Economic Society, vol. 103(418), pages 718-728, May.
    9. Alain Trannoy, 2006. "Financement des universités, financement des études," Revue d'économie politique, Dalloz, vol. 116(6), pages 745-782.
    10. Barr, Nicholas, 1993. "Alternative funding resources for higher education," LSE Research Online Documents on Economics 280, London School of Economics and Political Science, LSE Library.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. David Flacher & Hugo Harari-Kermadec & Léonard Moulin, 2013. "Financing higher education: a contributory scheme," Working Papers 2013/34, Institut d'Economia de Barcelona (IEB).
    2. David Flacher & Hugo Harari-Kermadec & Léonard Moulin, 2013. "Financing Higher Education: a contributory education scheme," CEPN Working Papers hal-00870921, HAL.
    3. Booij, Adam S. & Leuven, Edwin & Oosterbeek, Hessel, 2012. "The role of information in the take-up of student loans," Economics of Education Review, Elsevier, vol. 31(1), pages 33-44.
    4. Philippe Batifoulier & Denis Abecassis & Nicolas da Silva & Victor Duchesne & Léonard Moulin, 2016. "L’utilité sociale de la dépense publique," Working Papers hal-01421197, HAL.
    5. Anchor, John R. & Fiserová, Jana & Mars[iota]ková, Katerina & Urbánek, Václav, 2011. "Student expectations of the financial returns to higher education in the Czech Republic and England: Evidence from business schools," Economics of Education Review, Elsevier, vol. 30(4), pages 673-681, August.
    6. repec:lan:wpaper:2434 is not listed on IDEAS
    7. Gregorio Caetano & Miguel Palacios & Harry A. Patrinos, 2019. "Measuring Aversion to Debt: An Experiment Among Student Loan Candidates," Journal of Family and Economic Issues, Springer, vol. 40(1), pages 117-131, March.
    8. Orkodashvili, Mariam, 2007. "Higher Education Funding Issues: U.S. / UK Comparison," MPRA Paper 16417, University Library of Munich, Germany.
    9. Elena Del Rey, 2011. "Deferring higher education fees without relying on contributions from non-students," Education Economics, Taylor & Francis Journals, vol. 20(5), pages 510-521, May.
    10. Migali, Giuseppe, 2006. "Funding Higher Education and Wage Uncertainty: Income Contingent Loan Versus Mortgate Loan," The Warwick Economics Research Paper Series (TWERPS) 740, University of Warwick, Department of Economics.
    11. Carlos Giovanni González Espitia & Jhon James Mora Rodríguez & Cecilia Albert Verdú, 2015. "Corrección del sesgo de selección muestral en la probabilidad de demandar educación universitaria en Colombia," Icesi Economics Working Papers 14567, Universidad Icesi.
    12. Appleton, Simon, "undated". "User Fees, Expenditure Restructuring and Voucher Systems in Education," WIDER Working Papers 295459, United Nations University, World Institute for Development Economic Research (UNU-WIDER).
    13. Alexander Kemnitz, 2007. "University Funding Reform, Competition, and Teaching Quality," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 163(2), pages 356-378, June.
    14. Gicheva, Dora, 2011. "Does the Student-Loan Burden Weigh into the Decision to Start a Family?," UNCG Economics Working Papers 11-14, University of North Carolina at Greensboro, Department of Economics.
    15. Denis Maguain, 2007. "Les rendements de l'éducation en comparaison internationale," Économie et Prévision, Programme National Persée, vol. 180(4), pages 87-106.
    16. Kemnitz, Alexander, 2003. "Funding, Competition and Quality in Higher Education," Discussion Papers 610, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    17. repec:lan:wpaper:2660 is not listed on IDEAS
    18. Barr, Nicholas, 2004. "Higher education funding," LSE Research Online Documents on Economics 288, London School of Economics and Political Science, LSE Library.
    19. Tom McKenzie & Dirk Sliwka, 2011. "Universities as Stakeholders in their Students' Careers: On the Benefits of Graduate Taxes to Finance Higher Education," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 167(4), pages 726-742, December.
    20. Berlinger, Edina, 2005. "A nyugdíjrendszer és a diákhitelrendszer összekapcsolása [Connecting the pension and student-loan systems]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 631-647.
    21. Migali, Giuseppe, 2012. "Funding higher education and wage uncertainty: Income contingent loan versus mortgage loan," Economics of Education Review, Elsevier, vol. 31(6), pages 871-889.
    22. Gianni De Fraja, 2004. "Education and Redistribution," Rivista di Politica Economica, SIPI Spa, vol. 94(3), pages 3-44, May-June.

    More about this item

    Keywords

    Universal Autonomy Allowance; contributory scheme; funded education scheme; financing higher education; equity; efficiency;
    All these keywords.

    JEL classification:

    • H81 - Public Economics - - Miscellaneous Issues - - - Governmental Loans; Loan Guarantees; Credits; Grants; Bailouts
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ieb:wpaper:doc2013-34. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/iebubes.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.