Pay-it-forward college financing policies examined in new study

by Sharita Forrest  /   Oct 4, 2017

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Pay-it-forward financing programs could have differing effects on college access and voter support for tax subsidies, depending on how individual voters fare economically, according to a paper co-written by Associate Professor Jennifer Delaney of the Department of Education Policy, Organization & Leadership.

And despite some critics’ fears, pay-it-forward programs could increase—rather than erode—public funding for higher education, say the researchers, which includes co-author Dhammika Dharmapala.

In a paper published in the journal Contemporary Economic Policy, Delaney and Dharmapala used a theoretical model to examine how public funding for higher education might be affected if U.S. colleges and universities changed from an upfront tuition model to pay-it-forward programs that allowed students to pay for their education after graduating and obtaining employment.

Delaney and Dharmapala compared the potential impact of deferred tuition and income share programs on college access and voter support for taxes that subsidize higher education. Their analyses assumed a theoretical national pay-it-forward system funded by the federal system that currently supports the federal student loan program.

By removing the financial barrier of upfront tuition, a deferred tuition model would promote college access, making attendance nearly universal, the researchers suggested.

Read the full Illinois News Bureau article.