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Tax benefits for graduate education: incentives for whom?

Numerous studies have examined the enrollment responses of traditional undergraduate students to the introduction of government-provided tuition subsidies, but far less attention has been devoted to the elasticity of demand for graduate education. This paper examines how the tax code and government education policies affect graduate enrollment and persistence rates along with the ways in which students fund their graduate education. [The authors'] empirical methodology is based on exogenous variations in the availability of an income tax exemption for employer-provided tuition assistance for graduate courses. [The authors] find that graduate attendance among full-time workers age 24-30 is higher when the tax exemption is available, mostly due to higher persistence in public universities and vocational course work. The use of employer aid for individuals enrolled in full-time and public part-time graduate programs also increases. [The authors] present some evidence that universities may adjust tuition to capture part of the incidence.

Numerous studies have examined the enrollment responses of traditional undergraduate students to the introduction of ...  Show Full Abstract  

Authors: Bednar, Steven; Gicheva, Dora
Date: 2013
Geographic subjects: North America; United States
Journal title: Economics of education review
Resource type: Article
Subjects: Finance; Higher education; Participation;

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Pomp and circumstance: university presidents and the role of human capital in determining who leads US research institutions

While there is wide agreement that leaders matter, little is known regarding the role that human capital plays in determining who becomes one. We exploit unique attributes of the higher education industry to examine if training and academic ability affect the placement of university presidents within the research hierarchy of US institutions. The analysis uses two data sets drawn from the American College President Survey conducted over three decades and a digitized sample of 212 curriculum vitae for presidents at top US universities in 2009, to model the factors that determine who among the pool of university presidents places at Carnegie-classified research institutions. The findings suggest the rise to the presidency of a research institution depends on the investments in research-specific human capital over the entire course of a career consistent with prior evidence that the knowledge of the research enterprise is critical to the success of such institutions.

While there is wide agreement that leaders matter, little is known regarding the role that human capital plays in ...  Show Full Abstract  

Authors: Singell, Larry D.; Tang, Hui-Hsuan
Date: 2013
Geographic subjects: United States; North America
Journal title: Economics of education review
Resource type: Article
Subjects: Providers of education and training; Management; Skills and knowledge

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University rankings in action?: the importance of rankings and an excellence competition for university choice of high-ability students

This paper analyzes how high-ability students respond to different indicators of university quality when applying for a university. Are prospective students influenced by quality indicators of a university ranking or by an excellence status awarded within a nationwide competition? And if so, are some quality dimensions, e.g. research reputation, mentoring, faculty infrastructure, students' satisfaction or the excellence status, more important than others? In order to address these questions, I estimate a random utility model using administrative application data of all German medical schools. As identification relies on the variation in quality indicators over time, I can disentangle the response to changing quality indicators from the common knowledge regarding university attractiveness. Results show that the ranking provides more relevant information in the quality dimensions mentoring, faculty infrastructure and the overall students' satisfaction than with respect to research.

This paper analyzes how high-ability students respond to different indicators of university quality when applying for a ...  Show Full Abstract  

Authors: Horstschraer, Julia
Date: 2012
Geographic subjects: Germany; Europe
Journal title: Economics of education review
Resource type: Article
Subjects: Higher education; Providers of education and training; Performance;

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High school grades and university performance: a case study

A critical issue facing a number of colleges and universities is how to allocate first year places to incoming students. The decision to admit students is often based on a number of factors, but a key statistic is a student's high school grade. This paper reports on a case study of the subsequent performance at the University of Winnipeg of high school students from 84 Manitoba high schools. By tracking the university performance of students admitted for the years 1997-2002, we are able to estimate the likelihood of success of subsequent students based on their characteristics as well as their high school grades. In doing so, we used a number of alternative estimators including a Least Squares Dummy Variable Model and a Hierarchical Linear Model. The methodology should be of interest to admissions officers at other universities as an input into estimating the subsequent performance of first year students.

A critical issue facing a number of colleges and universities is how to allocate first year places to incoming students. The ...  Show Full Abstract  

Authors: Cyrenne, Philippe; Chan, Alan
Date: 2012
Geographic subjects: Canada; North America
Journal title: Economics of education review
Resource type: Article
Subjects: Providers of education and training; Students; Outcomes;

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Higher education in Turkey: subsidizing the rich or the poor?

We investigate how the benefits of publicly financed higher education in Turkey are distributed among students with different socioeconomic backgrounds. We use a unique dataset from a nationally representative sample of university entrance exam takers together with data on government subsidies to public universities. We compare the characteristics of students who succeed in the exam to those who do not and those who enter public universities to those who go to private ones. Our econometric analyses based on a three-stage selection model reveal that students from wealthier and more educated families are more likely to be successful at university entrance. Unlike the findings in other countries, students who enroll in private universities come from higher income and more educated families. However, among those who enter public universities, students from higher income and more educated families are more likely to go to universities that receive larger subsidies from the government.

We investigate how the benefits of publicly financed higher education in Turkey are distributed among students with ...  Show Full Abstract  

Authors: Caner, Asena; Okten, Cagla
Date: 2012
Geographic subjects: Turkey; Europe
Journal title: Economics of education review
Resource type: Discussion paper
Series name: IZA discussion paper
Subjects: Higher education; Equity; Finance;

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Parental education, grade attainment and earnings expectations among university students

While there is an extensive literature on intergenerational transmission of economic outcomes (education, health and income for example), many of the pathways through which these outcomes are transmitted are not as well understood. We address this deficit by analysing the relationship between socio-economic status and child outcomes in university, based on a rich and unique dataset of university students. While large socio-economic differences in academic performance exist at the point of entry into university, these differences are substantially narrowed during the period of study. Importantly, the differences across socio-economic backgrounds in university grade attainment for female students is explained by intermediating variables such as personality, risk attitudes and time preferences, and subject/college choices. However, for male students, we explain less than half of the socio-economic gradient through these same pathways. Despite the weakening socio-economic effect in grade attainment, a key finding is that large socio-economic differentials in the earnings expectations of university students persist, even when controlling for grades in addition to our rich set of controls. Our findings pose a sizable challenge for policy in this area as they suggest that equalising educational outcomes may not translate into equal labour market outcomes.

While there is an extensive literature on intergenerational transmission of economic outcomes (education, health and income ...  Show Full Abstract  

Authors: Delaney, Liam; Harmon, Colm; Redmond, Cathy
Date: 2011
Geographic subjects: Ireland; Europe
Journal title: Economics of education review
Resource type: Article
Subjects: Equity; Students; Outcomes;

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(Un)desirable effects of output funding for Flemish universities

Governments introducing output parameters (e.g. graduation numbers) in the funding rule of universities believe that it will induce universities to raise their teaching efforts while educational standards will remain unaffected. In this article we first show on theoretical grounds that this desire can only be fulfilled if there exist positive interaction effects between student ability, student effort and teaching effort in the educational production function. Secondly, even if this is the case we argue that universities attracting more students with a vulnerable socioeconomic background will not be rewarded for raising their teaching effort in the same way as other universities. Empirical data on success rates of Flemish university students reveal indeed a strong correlation between students' probabilities of success and socioeconomic background. Moreover, we find a strong social clustering within universities.

Governments introducing output parameters (e.g. graduation numbers) in the funding rule of universities believe that it will ...  Show Full Abstract  

Authors: Cantillon, B.; De Ridder, A.; Vanhaecht, E.;
Date: 2011
Geographic subjects: Belgium; Europe
Journal title: Economics of education review
Resource type: Article
Subjects: Higher education; Providers of education and training; Finance;

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Size matters: the relevance and Hicksian surplus of preferred college class size

The contribution of this paper is twofold. First, we examine the impact of class size on student evaluations of instructor performance using a sample of approximately 1400 economics classes held at the University of Munich from Fall 1998 to Summer 2007. We offer confirmatory evidence for the recent finding of a large, highly significant, and nonlinear negative impact of class size on student evaluations of instructor effectiveness that is robust to the inclusion of course and instructor fixed effects. Beyond that, we run a survey based on the contingent valuation method and a representative sample of all Munich students of management science to quantify the welfare surplus of preferred class size. We find the average monetary value students ascribe to their preferred class size to lie between five and 300 Euros per semester and student. In an upper bound scenario, implied Hicksian surpluses can reach values of close to 500 Euros per semester and student.

The contribution of this paper is twofold. First, we examine the impact of class size on student evaluations of instructor ...  Show Full Abstract  

Authors: Mandel, Philipp; Sussmuth, Bernd
Date: 2011
Geographic subjects: Germany; Europe
Journal title: Economics of education review
Resource type: Article
Subjects: Higher education; Providers of education and training; Students;

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Keeping up with the Joneses: institutional changes following the adoption of a merit aid policy

The increasing use by private colleges and universities of financial aid based on 'merit', as opposed to based solely on financial need has caused many to raise concerns that this type of aid will go mainly to higher income students crowding out aid to lower income students. However, some analysts suggest that by attracting more 'almost full-paying' students through the use of merit aid, institutions will have more financial resources that they can use to increase their financial aid to low-income students and thus their enrollment. Results using data from the College Board's Annual Survey of Colleges and other secondary data sources suggest that the increased use of merit aid is associated with a decrease in enrollment of low-income and minority students, particularly at more selective institutions. Middle and bottom tier colleges may be offsetting costs with tuition increases, as the introduction of merit aid is accompanied by an increase in net costs.

The increasing use by private colleges and universities of financial aid based on 'merit', as opposed to based solely on ...  Show Full Abstract  

Authors: Griffith, Amanda L.
Date: 2011
Geographic subjects: United States; North America
Journal title: Economics of education review
Resource type: Article
Subjects: Higher education; Finance; Providers of education and training;

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A low-subsidy problem in public higher education

With an exogenous public subsidy and a break-even restriction on university net revenue, tuition discrimination supports a quasi-efficient departure from marginal-cost pricing. In contrast, when the legislature and university interact in their subsidy and tuition decisions, the public subsidy becomes endogenous. With an endogenous public subsidy, support by legislatures is affected by the same factors that influence tuition; this leads to a situation where higher tuition revenue is accompanied by a lower public subsidy. The welfare of students declines when this 'low-subsidy' case develops. The university's ability to address this issue depends on its being able to commit to a tuition policy, and credible commitment appears consistent with existing institutional conditions.

With an exogenous public subsidy and a break-even restriction on university net revenue, tuition discrimination supports a ...  Show Full Abstract  

Authors: Fethke, Gary
Date: 2011
Geographic subjects: United States; North America
Journal title: Economics of education review
Resource type: Article
Subjects: Higher education; Finance; Providers of education and training

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