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Manhattan Institute

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Issues 2016: Will Free Tuition Increase the Number of College Graduates?

issue brief

Issues 2016: Will Free Tuition Increase the Number of College Graduates?

September 22, 2016
EducationHigher Ed
Urban PolicyEducation

Abstract

To increase the number of graduates, a growing number of pundits and politicians favor providing free tuition for students attending public colleges and universities. This proposal is flawed. Affordability is not the main obstacle to getting a degree. There is also a risk that a tuition-free system for public institutions would leave them solely dependent on taxpayer dollars. If public budgets fail to keep pace with the increased demand and rising costs, colleges will be forced to limit the number of students they can accept, or sacrifice the quality of instruction, or both. Heightened competition for spaces could crowd out lower-income students from higher-quality public institutions.

Key Findings

  • International comparisons render as dubious the assumption that free tuition in the U.S. would lead to higher numbers of college graduates. Within the G-7, the four countries that charge college tuition have higher education attainment rates (Japan, 59%; Canada, 58%; United Kingdom, 48%; United States, 46%) than those that don’t (France, 44%; Germany, 28%; Italy, 24%).
  • Low tuition price caps forced colleges in England to ration the available spaces. When the caps were lifted, institutions raised tuition fees by 87% between 2006 and 2012—yet college enrollment grew by 20%, and applicants from the most disadvantaged backgrounds grew by 53%. By contrast, when Scotland eliminated tuition fees in 2007, low-income enrollment rates grew only one-tenth as quickly as in England.
  • In the U.S. federal grants already make tuition free, on average, for low-income students at community colleges. Yet just one-third of students from the bottom quartile of the income distribution who started at a community college in 2003 had finished a degree or certificate by 2009.

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______________________

Max Eden is a senior fellow at the Manhattan Institute.

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