Work detail

Why should the Czech Republic reform its current policy of financing higher education?

Author: Bc. Pavlína Kadlecová
Year: 2014 - summer
Leaders: Mgr. Barbara Pertold-Gebicka M.A., Ph.D.
Work type: Bachelors
Language: English
Pages: 59
Awards and prizes:
Abstract: Abstract
The Czech Republic has traditionally financed higher educati
on out of general
taxation and in the form of
per capita
funding. This system has led to inef-
ficient allocation of funds, long-term underfunding and decr
easing quality of
education. We present three alternative financing schemes wh
ich rely on larger
contribution from students: pure student loan, risk-shari
ng income-contingent
loan and risk-pooling income-contingent loan. By using a the
oretical model
and calibrating it to the Czech reality, we show that financin
g schemes have
significant impact on higher education participation and the
quality of accepted
students. While pure loan and risk-pooling induce optimal pa
rticipation, in-
ternational experience suggests that risk-sharing is the m
ore feasible option.


Česká Spořitelna


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