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One might reasonably make a case for taxing higher education, particularly if one views the acquisition of bachelor’s degrees to be much like an arms race. Suppose I proposed to increases taxes on colleges and I come out publicly and say, “we are going to institute a 20% tuition tax on college attendence; however, students have no reason to worry about this, we are structuring the tax so that the universities will be solely responsible for paying this tax!” Would students rest easily in the knowledge that indeed the universities would pay?

Survey college students and ask them. And then follow up with the same question and replace the term “college” with “any other corporation” and tell me their response. Of course, what matters are underlying relative demand and supply elasticities. But I don’t suspect the lay person has any such model in mind when dealing with this question, hence my assertion that you can’t have it both ways if you don’t have a model.

One Response to “Taxing Higher Education”

  1. Harry says:

    Hahaha. Supply and demand elasticities. I bet that one threw everybody at the BER to their old textbooks.

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