London School of Economics Centre for the Economics of Education LSE
Centre for the Economics of Education  (CEE)

Abstract for:

From Grants to Loans and Fees: The Demand for Post-Compulsory Education in England and Wales from 1955 to 2008

Peter  Dolton,  Li  Lin,  September 2011
Paper No' CEEDP0127: | Full paper (pdf)
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Keywords: post compulsory education; student finance, structural change

JEL Classification: J08; I22; I28

Is hard copy/paper copy available? YES - Paper Copy Still In Print.
This Paper is published under the following series: CEE Discussion Papers
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Abstract:

The UK has progressively moved from a Higher Education (HE) system which is funded at the tax payers’ expense to one which is funded by individual participants (and their parents) by scrapping student grants, introducing student loans and charging tuition fees. The purpose of this paper is to identify the impact of these changes on the demand for HE using time-series data for England and Wales over the period 1955 to 2008. We use a Seemingly Unrelated Regressions model of three indicators of demand for post-compulsory education allowing for structural breaks. Tests show that most of the breaks occurred in line with several important policy changes. We find that less generous student financial support arrangements have had a significant negative impact on university enrolment. We simulate the impact of raising tuition fees to £9,000 pa and find that this will reduce demand for HE from boys by 7.51 percentage points and from girls by 4.92 percentage points.