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Higher Education Finance and Access in Comparative Perspective. D. Bruce Johnstone, SUNY Buffalo Expanding Access: Lessons from Abroad ACE Annual Meeting February 2007. Financial Problems of Higher Education Worldwide.

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Higher Education Finance and Access in Comparative Perspective

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Higher Education Finance and Access in Comparative Perspective

D. Bruce Johnstone, SUNY Buffalo

Expanding Access: Lessons from Abroad

ACE Annual Meeting February 2007

Financial Problems of Higher Education Worldwide

  • Trajectory of costs (per-student and total) increasing faster than revenues (at least public)

  • Austerity: overcrowding, deterioration of quality, loss of faculty & morale

  • Tuition fees and other expenses rising (inflation+)

  • Diminishing relative priority of H. Ed.

  • Diminished confidence of governments in higher education –especially in faculty & management

Limitations on Higher Ed. Access & Participation Worldwide

  • Losses at middle and secondary levels

  • Limitations in higher educational capacity

  • Limited free or low fee places (dual tuition)

  • Persisting link between measured ability & aspiration and family class / privilege

  • Losses or freezing of grant aid

  • Limited student loans

The Hazards of Generalization: Countries vary greatly in:

  • Per-capita GDP

  • Rate of Growth of GDP

  • Capacity, cost-effectiveness, and progress-ivity of additional taxation

  • Population growth

  • % completing academic secondary school

  • Capacity and diversity of post-secondary options

“hazardous variations” continued

  • Variations in the political and cultural acceptability of:

    • Tuition fees

    • Private higher education

    • Parental financial responsibility for post-secondary education of children

The Perfect Storm: Financial Limitations on Accessibility …

  • Low GDP: per capita and low rate of growth

  • Very low tax capacity: Marginal taxation cost-ineffective, regressive, and detrimental to growth

  • Substantively & politically compelling queue of competing public needs ahead of higher education

  • Rapid increase in birth rate & h.s. participation rate  veryrapid growth of higher ed. aspirants

  • Political culture of entitlement and fear of student movements: great resistance to cost-sharing

  • Limited capacity for targeting or for lending

Things are Easy…

  • Substantial additional progressive tax capacity

  • Substantial tuition-dependent private sector

  • Acceptance of appropriateness of tuition fees and philanthropy in public sector

  • Substantial and diversified H Ed. Capacity

  • Near saturation of participation [?]

  • low rate of growth of secondary school leavers

  • Well-developed systems for grants and loans

US Comparative Advantages(Why we get the more higher education capacity for the tax $)

  • Diversified system (multiple entry points & “horizontal” transfer possibilities)

  • Substantial private sector

  • Acceptance of parental financial responsibility for children’s higher ed.

  • Tradition (and partial subsidization) of philanthropy: public as well as private

US Comparative Advantages(Why we get more higher educational access for the tax $)

  • Financial Assistance [$134 Billion 2005-06]

    • Ability to target assistance (on decline)

    • Abundant loans, minimally subsidized

    • Ability to tap private capital markets for loans

  • Capacity & competition: “client seeking”

  • Recognition of link between privilege and measured academic readiness (GPA / SAT)

  • Recognition that “race & ethnicity matter” (although on decline)

But We Can Learn …

  • Better relate repayments to level of income (Australia,UK, Canada, the Netherlands)

  • Better control of loan defaults through appropriate use of co-signatories

  • Institute bi-lateral & multi-lateral agreements on student loans

  • Assure greater transparency on institutional “quality”

Summary: Finance and AccessFour Worldwide Trends

  • Cost-sharing & other forms of revenue Diversification

  • Sector Diversification

  • Budget Reform / Autonomy

  • Privatization

    Others [modularizing curriculum, shortening time & conforming 1st degree, enhancing internationalization,]

For More Information:

  • For additional information, country studies, and papers on international comparative tuition and financial assistance policies, visit the Website of the International Comparative Higher Education Finance and Accessibility Project:

  • http://www.gse.buffalo.edu/org/IntHigherEdFinance

  • Bruce Johnstone

  • University at Buffalo, dbj@buffalo.edu

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