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What Factors Contribute to Cost Increases in Higher Education - Research Paper Example

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Education is, by far, the most important tool for the development of a society. It is a sign of prosperity and serves as a catalyst for any country’s propagating economy.The cost of education lifting high and out of the reach of common man is creating a void that needs to be filled…
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What Factors Contribute to Cost Increases in Higher Education
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Download file to see previous pages Unlike older days, the global niche has become more and more competitive. It is a race; survival of the fittest. The more skilled and educationally equipped the more chance you have to fight and survive. Catching up with the technology is one way higher education enhance economic development as graduates are better equipped to use new technologies. It is a complete cycle as higher education provides better job opportunities which in turns run the economic engine providing more capital which can be collected back as taxes and used to further improve the framework of higher education. (Bloom et al 2006). Concept that higher education plays an important role in the economic development and institutions can stimulate productivity was first introduced by Theodore W. Schultz. He introduced the idea of Human capital and its link to modernizing economy which flourished into complete Human Capital Research Program influencing many researchers and policy makers. (Teixeira 2006).The nations have long realized the significance of higher education and much has been done to build a solid infrastructure that can extract and polish the skills of an individual. But the capital required to obtain such qualifications is on the rise making it difficult for a middle class family to afford. According to the US statistics shown by Institutional Characteristics Survey tuition fee charges remained relatively stagnant in the 1970s. But there was a considerable increase in fee charges between 1980 and 1990. This increase not only had a great effect on the student and parents but also on education policymakers. In the same survey it was noted that rate of increase was greater at public institutions as compared to private institutions. Despite increase in tuition charges, number of students continuing on to higher education after finishing their high school has raised from 49% in 1980 to nearly 62% in 1993. During 1992-93 full time students attending a public school received financial aid on an average of 29%. The aid was greater for families with poor income about 80% and less for high income families about 10%. (Livingston 1995). Some enthusiast believes that higher education should be free. Many would agree that this statement is misconstructed. Even though sometimes consumer may not have to pay for a product but someone else in the background is bearing the cost. Going through a lot of literature I realized that it has been debated extensively but the question is still the same: who should pay? (Johnstone et al 2010). Before we can answer this question we need to understand different policies which provide the revenue that fuel the education system. The most common and classical model is General Tax system. In this policy, the funds are collected via general taxes imposed on every individual of the country. This model has served well over the decades but in general violated the beneficiary pays principle. Although university graduates mostly contribute in this revenue collection, a large proportion never attended the university and still has to pay. However, this policy is in line with equal opportunities for equal abilities principle. Second plan that provide funds to higher educational system is implementation of tuition fees and scholarship combination model. Institutions take a considerable amount of tuition fee to compensate for the operating cost. This is line with the beneficiary pays principle but defies the principle of equal access. This model favors the ...Download file to see next pagesRead More
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