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Surprise: HE money pays off

VU International News and Reviews No. 97 September 11 2017

September 2017

In a report on “The Impact of Price Caps and Spending Cuts on U.S. Postsecondary Attainment” for the US National Bureau for Economic Research, two professors from Harvard and UCLA compare the impact of the marginal taxpayer dollar on postsecondary attainment when it is spent on lowering tuition prices versus increasing the quality of the college experience.  They have estimated the causal impact of changes in tuition and spending on enrollment and degree completion in U.S. public postsecondary institutions between 1990 and 2013.

They find large impacts of spending on enrollment and degree completion, but no impact of price changes. Consequently, they suggest that spending increases are more effective per dollar than price cuts as a means of increasing postsecondary attainment.

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