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As someone who is just about to be directly affected in my bank account by university tuition, this is fascinating. Thanks.

I wondered two things: in some cases it seems there is a confusion between the prospective student and the prospective student's parents. For example, (4) "the percentage of those who cite financial barriers as a reason for not going to university has decreased" - you may get a different opinion from my son and from me if you ask about financial barriers to him going to university.

Second, looking at the (average) benefit of a university education seems to miss a big point (which I have not seen taken up elsewhere). I wonder what the standard deviation is on that number? A big average benefit with a significant prospect of a negative benefit would have a different impact on many people's decision making than a guaranteed big average benefit.

I'm pretty sure they ask the students themselves. I agree that the issue of just how much parents are willing - as opposed to able - to contribute is often a thorny one. But it's probably hard to get much more than anecdotal evidence on that.

And there certainly is a lot of variation in benefits, which should affect the willingness to take on debt. But apparently, the link between debt and post-graduate income isn't as strong as might be expected. I'll see if I can track something down.

Thanks!

They ask the students, not the parents. One of the problems, though is that the question is vague, and can be interpreted as meaning (a) university costs too much; or (b) I don't have the up-front funds to go, but would if I could get access to a cheap enough loan. These two are very different things from a policymaker's perspective.

There's a recent AER paper on the risks associated with university education, and some research suggesting that it is a quite risky investment, so university students tend to be relatively risk-taking compared to the non-student population. This wasn't exactly my feeling when I was going through, though: I considered not going to university very risky, and thought uni was the safe option. I suspect perceptions of the risk of uni depend on your family background, and on your peer group. This makes sense, because actually measuring the return to education is very difficult - measuring the risk around that return in any clearcut way is extremely nasty.

Stephen also mentions the differences in estimated costs of attending university depending on family background. If true, this would systematically cause students from low income/education families to attend uni less.

Averages are particularly meaningless in the area of student financial aid. There was a huge jump in the maximum amounts students could borrow under the CSLP in 2004 and 1994, which caused big increases in borrowing among those near the maxima, but didn't have much effect on anyone else. This still showed up in the averages, but doesn't look nearly as dramatic as it actually was for the affected students.

It might be interesting to look at the variation in government spending on education across Canada and the number of tax-paying citizens in each region. Under the current system, Atlantic Canada seems to have too many universities chasing too few tax dollars from its small population to prop up the number of universities that it does. As a consequence, some students in this region pay higher fees than anywhere else in Canada.

Not sure that's true, actually: NS still spends quite a lot per capita on universities, but not so much per student. What that means is that NS, eg, is doing is oversupplying places relative to the rest of Canada, but undersubsidising them, meaning out of province students pay more. And they do have programs to provide a bit of extra assistance to students from their own province (tax credits in NB, eg). If you net it all out, it'll probably look something like students FROM the region end up paying a bit more on average than those in other provinces, but students from other regions studying in the maritimes probably bear most of the cost. But this is a reasonable response if other provinces are trying to free ride on NS universities - have low tuition fees in their own provinces, but few places, forcing students out of province.

Optimal industry structure is another matter, and something I know less about (do universities have significant increasing returns to scale? I don't really know).

Basically - it's more complicated than it looks, and I don't think anyone's really going to be able to figure it all out. Though The Price of Knowledge does an excellent job.

What do you mean ?

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