JavaScript is disabled for your browser. Some features of this site may not work without it.
Challenges Facing “Pay-What-You-Can-Afford” Tuitions at Public Universities
dc.contributor.author | Fethke, Gary | |
dc.date.accessioned | 2020-11-17T16:57:54Z | |
dc.date.available | 2020-11-17T16:57:54Z | |
dc.date.issued | 2017-01-01 | |
dc.identifier.other | 15760555 | |
dc.identifier.uri | https://hdl.handle.net/1813/74651 | |
dc.description.abstract | Pay-What-You-Can-Afford (PWYCA) tuition structures are a suggested way to offset declines in state appropriations to public higher education, without limiting access for qualified low-income students. The concept implements high tuition, high aid tuitions routinely employed at private universities, effectively replacing private endowment income with state appropriations. The idea involves setting resident tuitions at non-resident rates minus the state appropriation per resident, and then using the subsequent incremental tuition revenue to subsidize low-income residents. This fairness-based approach in public higher education ignores: i) how non-resident tuitions are determined; ii) the welfare effects of introducing inefficient distortions in relative demand patterns; and iii) the likely accompanying decline in state appropriations. Here, the tuition-setting rules associated with PWYCA are derived, rather than being imposed, as solutions to a welfare-maximizing model in which non-residents pay fully-allocated costs and state appropriations are endogenous. University of Michigan budget, enrollment, and tuition data are used to illustrate the implications of selecting alternative high tuition, high aid tuition structures. Because demand-side inefficiencies are introduced, both welfare and, importantly, the state appropriation decline with implementation of PWYCA. While the decline in welfare is modest, the redistribution of value among residents, non-residents, and state taxpayers is substantial. | |
dc.language.iso | en_US | |
dc.rights | Required Publisher Statement: Published by the Cornell Higher Education Research Institute, ILR School, Cornell University. | |
dc.subject | Pay-What-You-Can-Afford tuitions | |
dc.subject | Tuition subsidies | |
dc.subject | High tuition-high aid | |
dc.subject | Non-resident full-cost tuitions | |
dc.subject | Appropriations to higher education | |
dc.subject | Higher education finance | |
dc.subject | Tuition structure efficiency | |
dc.title | Challenges Facing “Pay-What-You-Can-Afford” Tuitions at Public Universities | |
dc.type | article | |
dc.description.legacydownloads | CHERI_WP179.pdf: 10 downloads, before Oct. 1, 2020. | |
local.authorAffiliation | Fethke, Gary: University of Iowa |
Files in this item
This item appears in the following Collection(s)
Related items
Showing items related by title, author, creator and subject.
-
Resident and Nonresident Tuition and Enrollment at Flagship State Universities
Rizzo, Michael J.; Ehrenberg, Ronald G. (2004-01-01)[Excerpt] How tuition levels, or the availability of grant or loan aid, influence access are empirical questions that we will not address in this chapter. Rather, we will analyze how tuition and enrollment strategies at ... -
The Economics of Tuition and Fees in American Higher Education
Ehrenberg, Ronald G. (2007-10-22)This paper provides an introduction to the economics of tuition and fees in American Higher Education. It summarizes data on undergraduate tuition and fee levels in public and private institutions, discusses the forms of ... -
Adams, Thomas T.
Adams, Thomas T.; Martin, Peter W. (Cornell Law School, 2004-10-01)From the video archives of the Cornell Law School Heritage Project. The interviewer is Peter W. Martin; the videographer, Jae-Hyon Ahn. This video contains an interview with Thomas (Tom) Adams, Cornell Law School class of ...