Sobre aranceles, su rebaja y desaparición
Septiembre 20, 2015

An Argument About the Effects of Tuition Reductions

At various times in the past (herehere, and here, for example), I have made the argument that lowering tuition fees is regressive because the benefits will accrue to people who are either the children of the wealthy, or people who will be wealthy, or both.  I have also said that where neither of those conditions is true (for example, some types of community college programs), there is a reasonable case for free tuition.

As a rule, people who disagree with this position make one of three tactical responses.  The first is to hurl abuse, usually with the word “neo-liberal” thrown in for good measure.  These people we can safely ignore.  The second is to take the Hugh McKenzie-CCPA route, which is to say it’s OK to have these kinds of transfers to the rich because they pay more taxes than everyone else.  This is not prima facie idiotic, but it’s a very, very difficult argument to make as a progressive.  In fact, you can only really make it through a syllogism like this: “I am progressive.  I made a statement.  Therefore the statement is progressive”.  Evaluate as you will.

But there is also a (rarer) third response, which says: “ah, but you’re only looking at ceteris paribus results.  Surely free tuition would bring all sorts of new students to the table, and change the benefit calculus.”  Now it is undeniably true that *if* there was a massive shift in demand, then my argument would be wrong.  So let’s look at that *if* – how likely is it to happen?  What would have to happen in order for such a shift to take place?

Let’s look at this logically: would lower fees make anyone less likely to want to attend higher education?  No.  So any shift is not going to come from a fall in demand from upper-income groups, it’s going to have to come from a surge in demand from lower-income youth.  That’s possible, though unproven. There is, for instance, no data from either Manitoba or Newfoundland to suggest that this is what happened when they reduced tuition over a decade ago.  But let’s assume for the moment it’s true.

Now, you have to ask the question: even if aggregate demand increases, are universities likely to take in more students as a result of fee reductions?  Unless you’re also assuming that governments are going to spend a whole extra wad cash for expansion, on top of cash for eliminating fees (NB: the Green Party plan for free tuition in Canada does not do this; neither does the Chilean free tuition experiment), the answer here is “probably not” (or at least not much).  But if the supply of spaces is more or less fixed, then for any benefit-shifting to happen, additional students from poorer backgrounds are actually going to have to displace richer kids in order to close the gap.  Poor kids in, rich kids out.  That’s not an impossible outcome, but given that: a) universities ration places through grades; and, b) youth from higher-income families have an advantage in terms of academic preparation (go see any number of PISA studies on that one), it seems very unlikely.

But let’s suspend disbelief, and assume governments ARE in fact prepared to both reduce price and expand capacity.  What wold happen then?  Well, we don’t know, really.  But we do know that governments have been expanding university capacity tremendously over the past 15 years – partly through higher funding, and partly through higher fees.  And as far as we know (and admittedly we don’t know as much as we should), access has in fact been widened, at least as far as ethno-cultural backgrounds are concerned.  But that raises a question: if you can improve access simply by increasing capacity, why not just do that instead of spending all that money to also make it free?

In short, we know a way to improve access, and it doesn’t involve making higher education free.  Conversely, we know that making higher education free, on it’s own, is very unlikely to change the social composition very much (i.e. it won’t be effective on its own terms), and therefore will provide extraordinary benefits to children of upper-income families.

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