Guide to Reform of Higher Education: A European Perspective

82 Pages Posted: 4 Jan 2006

See all articles by Bas Jacobs

Bas Jacobs

Erasmus University Rotterdam (EUR); Tinbergen Institute; CESifo (Center for Economic Studies and Ifo Institute)

Rick van der Ploeg

University of Oxford

Multiple version iconThere are 2 versions of this paper

Date Written: November 2005


Although there are exceptions, most European universities and institutions of higher education find it difficult to compete with the best universities in the Anglo-Saxon world. Despite the Bologna agreement and the ambitions of the Lisbon agenda, European universities are in need of fundamental reforms. We look at structural reforms of higher education and propose more effective use of public subsidies, more efficient modes of financing institutions of higher education, more diversity, competition and transparency, and larger private contributions through income-contingent student loans. In the process we discuss the nature of an institution of higher education, grade inflation, fair competition, private and social returns to education, income-contingent loans, student poverty and transparency. We sum up with seven recommendations for reform of higher education.

Keywords: Higher education, policy reform, central planning, student loans, tuition fees, education subsidies, variety, selection, peer review, grade inflation, input funding, output funding, equity, monopoly, transparency

JEL Classification: H2, H4, I2

Suggested Citation

Jacobs, Bas and van der Ploeg, Frederick, Guide to Reform of Higher Education: A European Perspective (November 2005). CEPR Discussion Paper No. 5327. Available at SSRN:

Bas Jacobs

Erasmus University Rotterdam (EUR) ( email )

PO Box 1738
Rotterdam, Zuid-Holland 3000 DR
+314081452 (Phone)


Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679

Frederick Van der Ploeg (Contact Author)

University of Oxford ( email )

Manor Road Building
Manor Road
Oxford, OX1 3BJ
United Kingdom

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