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Charging for Higher Education: Estimating the Impact on Inequality and Student Outcomes

Author

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  • Azmat Ghazala

    (Sciences Po and CEP (LSE), Paris, France)

  • Simion Ştefania

    (University of Bristol and CEP (LSE), Bristol, UK)

Abstract

Over the last two decades, undergraduate university education in England moved from being state-funded and free for students, to costing all students substantial amounts in tuition fees. In this paper, using detailed administrative longitudinal microdata that follow all students attending state schools in England (approximately 95% of student population), we causally show that, despite the substantial reforms, enrollment fell only by 0.5 percentage points, where the effect is largely borne by those in wealthier groups, reducing the enrolment gap across socio-economic groups. Since tuition fees were introduced in conjunction with the government offering generous means-tested maintenance (cash) grants, as well as loans, our results highlight the importance of reducing financing constraints. Beyond enrollment, we find that the reforms have limited impact on students’ higher education choices, such as relocation decisions, university choice, and field of study. Finally, by tracking the students after graduation, we show similarly small effects on labor market outcomes.

Suggested Citation

  • Azmat Ghazala & Simion Ştefania, 2021. "Charging for Higher Education: Estimating the Impact on Inequality and Student Outcomes," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 21(1), pages 175-239, January.
    • Handle: RePEc:bpj:bejeap:v:21:y:2021:i:1:p:175-239:n:7
    DOI: 10.1515/bejeap-2020-0099
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    Cited by:

    1. Berens, Johannes & Henao, Leandro & Schneider, Kerstin, 2024. "Tuition fees and academic (in)activity in higher education: How did students adjust to the abolition of tuition fees in Germany?," Ruhr Economic Papers 1074, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.

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    More about this item

    Keywords

    higher education; inequality; tuition fees; means-tested support; career outcomes;
    All these keywords.

    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I29 - Health, Education, and Welfare - - Education - - - Other
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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