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Fiscal Competition and Higher Education Spending in Germany

Author

Listed:
  • Fischer Georg-Benedikt

    (Karlsruhe Institute of Technology,Karlsruhe, Germany)

  • Wigger Berthold U.

    (Karlsruhe Institute of Technology,Karlsruhe, Germany)

Abstract

The present paper studies the determinants of higher education spending by the German federal states with a focus on the interplay between higher education spending of neighboring states. More specifically, the paper asks whether the German federal states free-ride on one another’s higher educational spending or whether they employ higher education spending to attract university graduates. We identify a positive relationship between the states’ higher education spending and conclude that the states compete for graduates rather than free-ride. We also consider the effect of the recent introduction of tuition fees in some, but not all German states. We do not find evidence that tuition fees led to crowding out of public higher education funds.

Suggested Citation

  • Fischer Georg-Benedikt & Wigger Berthold U., 2016. "Fiscal Competition and Higher Education Spending in Germany," German Economic Review, De Gruyter, vol. 17(2), pages 234-252, May.
    • Handle: RePEc:bpj:germec:v:17:y:2016:i:2:p:234-252
    DOI: 10.1111/geer.12088
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    Cited by:

    1. Achten-Gozdowski, Jennifer, 2018. "Geschichte und Politökonomie deutscher Theatersubventionen [History and Political Economy of Public Subsidies for German Theatres and Operas]," MPRA Paper 85087, University Library of Munich, Germany.

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