Public Universities, Tuition and Competition - A Tiebout Model

Schwager, Robert

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URL:	http://ub-madoc.bib.uni-mannheim.de/1759
URN:	urn:nbn:de:bsz:180-madoc-17599
Document Type:	Working paper
Year of publication:	2007
The title of a journal, publication series:	None
Publication language:	English
Institution:	Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series:	Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject:	370 Education
Classification:	JEL: H77 I28 H75 ,
Subject headings (SWD):	Hochschule , Studienfinanzierung , Systemwettbewerb , Student , Tiebout-Theorem
Keywords (English):	higher education , migration , fiscal externality , club good , tuition
Abstract:	A simple Tiebout model is presented where states provide university education to both immobile and mobile students. State governments choose the quality of public universities by trading off the value of education for the local immobile student population and the costs, net of tuition revenues, of running the university. The quality of education and the assignment of students to universities in an effcient allocation are characterised. It is shown that decentralised decisions result in effcient choices if states are allowed to choose tuition levels freely. If tuition is capped, ineffciently low qualities are likely to arise.
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