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The Evolution of Public Spending on Higher Education in a Democracy

Alexander Haupt ()

No 1631, CESifo Working Paper Series from CESifo

Abstract: This paper analyses political forces that cause an initial expansion of public spending on higher education and an ensuing decline in subsidies. Growing public expenditures increase the future size of the higher income class and thus boost future demand for education. This demand shift implies that the initial subsidy per student becomes too expensive to be politically sustainable. Despite a voters’ backlash that curbs education subsidies, overall enrolments continue to rise. But the participation rate of the children of lower income families, that went up in the expansion period, declines over time, both in absolute terms and relative to the rate of their counterparts from higher income households.

Keywords: higher education; voting; social stratification; social mobility; overlapping generations (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-cdm, nep-edu and nep-pbe
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Journal Article: The evolution of public spending on higher education in a democracy (2012) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1631

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