The problem in higher education finance is not relatively insignificant changes in appropriations, but spiraling increases in operating costs. The difference between real appropriations and real operating costs has more than doubled from about $5,400 in 1970-71 to nearly $11,700 in 2007-08. Not surprisingly, higher tuition has filled this bulging gap.
Higher Education Subsidization: Why and How Should We Subsidize Higher Education?
We provide massive college subsidies at both the federal and state level. This paper explores the justifications for these college subsidies, subsidy design considerations, and evaluates the main subsidy programs to assess whether they are well-designed. Our evaluation discovers reasons to eliminate some subsidies and ways to improve other subsidies. Key points: Subsidies for higher...