Abstract
For a closed economy, we analyze the relation between the quality of higher education and the number of students. Within a two-period general-equilibrium model, we derive the optimal education policy – i.e., quality of and access restrictions to higher education – with observable ability, and contrast this with a setting where ability is unobservable and financial instruments are restricted to either taxes or fees. If the number of students increases with quality, then there are too many students with tax financing and the quality level is too low – and vice versa with fee financing. Results are not clear-cut when higher quality leads to a lower number of students.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: Journal of Institutional and Theoretical Economics
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
