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The welfare effects of discriminating between in-state and out-of-state students

Malte Hübner

Regional Science and Urban Economics, 2012, vol. 42, issue 1-2, 364-374

Abstract: In countries with a decentralized provision of higher education, local governments have incentives to levy higher fees on out-of-state students. This paper analyzes the implications of such preferential fee regimes for welfare and the number of students in a federation by means of a theoretical model in which higher education policies are determined non-cooperatively by local governments. In contrast to the literature on preferential tax regimes (e.g. Keen, 2001; Haupt and Peters, 2005), in my model, a restriction of preferential fee regimes raises federal welfare and enrollment in higher education.

Keywords: Higher education; Tuition fees; Preferential tax regimes (search for similar items in EconPapers)
JEL-codes: H73 H21 I22 (search for similar items in EconPapers)
Date: 2012
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Working Paper: The welfare effects of discriminating between in-state and out-of-state students (2009) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:42:y:2012:i:1:p:364-374

DOI: 10.1016/j.regsciurbeco.2011.06.005

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