We examine ways of funding higher education, comparing upfront tuition fees with graduate taxes. The tax dominates, as volatility in future income is transferred from risk-averse students to the risk-neutral state. However, a double moral hazard problem arises when students' efforts to raise...

We examine ways of funding higher education, comparing upfront tuition fees with graduate taxes. The tax dominates, as volatility in future income is transferred from risk-averse students to the risk-neutral state. However, a double moral hazard problem arises when students' efforts to raise...

The provision of a higher education to a student is a service like few others. For the service to deliver value requires the active participation of the recipient. Even then, the range of possible outcomes - whether measured as personal or career development - is very wide. The heavy burden on...