Colleges use appropriations, endowments, and other revenue sources to subsidize the cost of education for students. This subsidy is different from financial aid or scholarships because it is given to all students at the institution – and most don’t even know they’re receiving it. In many countries, government service provides for subsidization of higher education. How Much Does The Government Subsidize College?
The U.S. Federal Government spends tens of billions of dollars on subsidies for higher education. Studies show that approximately $80 billion per year is allocated to subsidies for higher education, the bulk of the spending going to student aid, with the rest going to grants for all educational institutions. Government implements subsidies for colleges because higher education paves way for growth in the economy, and brings more opportunities for many students to have access to higher education which leads to an improved nation.
For colleges, subsidies rendered are based on the number of students enrolled, evaluation for accreditation, capital expenditure, professional fields, and publishing of scientific works and textbooks. These government subsidies can be further divided into three categories which are:- Tax credits, tax breaks, and direct subsidies. Research on both federal and state government support for higher education unveils how much total support colleges and universities receive from government subsidies, what these numbers look in terms of per-student support and how much this amount has changed over time.
There is increasing public and political interest in college subsidy policies that reduce the cost of college attendance for students, facts reveal that the college published price is usually not the true total cost, because the government has already set up subsidy funds that are disbursed to colleges around the country. The direct costs associated with attending college are substantial and have rapidly grown over the past several decades, Herby requires the government to intervene by implementing subsidies. Any college subsidizing program can be expected to represent a huge yearly expenditure. It is this advisable to carefully calculate expected costs aligned with proposed programs and derive ways that program design can reduce sharp increases in tuition and fees charged by colleges.
How Much Is The Average Cost of Attending College?
College tuition is what colleges charge for the instruction and services they provide. Colleges charge tuition by units that make up an academic year, either by semester or quarter. It varies by the course studied, in most colleges, students who major in fine arts, sciences, computing, and engineering usually pay more than students in other majors. These fees cover the cost of services such as a library, student government, athletic facilities, health insurance e.t.c
Pulling to research from the College Board, the US has the most expensive yet sought-after colleges. There are public and private universities to choose from. You can either decide to attend a 2-year or 4-year university. Students are also provided with the option of studying in-state or out-of-state during their college years. To attend college, there are necessities and costs to cover which would be shown in the table below:-
| 2-year public university | 4-year public university | In-state | Out-of-state | |
| Tuition | $3,700 | $10,500 | $10,300 | $27,000 |
| Room and Board | $8,600 | $19,600 | $11,140 | $12,700 |
| Books and Study Supplies | $1,000 | $2,100 | $2,000 | $2,000 |
| Personal Expenses and Miscellaneous Items | $1500 | $2,500 | $2,000 | $4,000 |
And this is just a round-off estimate for attending a public university or college and it ranges from $17,000 to $20,000 for a 2-year public university and $35,000 – $40,000 for a 4-year public university so etines amounting up to $60,000 – $70,000 for graduate students. Students also have to put in mind when looking up good colleges to study that there is something called the sticker price – the published rates usually differ from the amount students pay once various sources of funding and financial aid are considered. Net price is the amount a student pays after receiving aid and scholarships, most times it’s rare for students to pay the tuition amount upfront. Different colleges have their different sticker prices based on how sought after the school is to how many athletic or academic awards a college has received.
Why Should the Government Subsidize Colleges?
An optimal education subsidy policy stimulates the student’s private economic motive for demanding education, by offering cheap tuition or providing loans at subsidized rates of interest, the consequent cost reductions lead to a greater demand for education. It also influences the type of education pursued and the distribution of education among the population. A general reduction in cost is an efficient way of promoting several economic goals.
Conclusion
Higher education is recognized as an important economic asset in itself because they have numerous ways of generating revenue to run their budgets and educate their students, but the truth here remains that students can only attend colleges they can afford thereby limiting their choice range. Government subsidies to higher education are often justified in that society derives political and public benefits from higher education because its promises to deliver reduced crime rates, increased tax revenue, a decreased reliance on government support, and an increase in charitable giving and community services, basically individuals who perform better as citizens.
The government provides subsidized loans for higher education and gives financial aid- need-based and merit-based. Universities receive significant funding from the government making tuition fees almost 30% more affordable for all students.
Frequently Asked Questions (FAQs)
1.) What does tuition subsidy mean?
Answer:- It is a grant of financial assistance to students by supplementing tuition fees either in form of cash or tax reduction
W.) Should the government help pay for college?
Answer:- Yes, because higher education is the only way to maintain a technological and developmental advantage over other nations.
3.) What percentage does government subsidies help offset the sticker price of colleges?
Answer:- About 30%, a sizeable amount that provides affordable education to all students
4.) Can you calculate the cost of college yourself?
Answer:- Yes, now college websites are equipped with calculators to help student calculate their tuition fees.
