Dresden Discussion Paper Series in Economics 14/06
Several Bundesländer in Germany have or are about to introduce tuition fees for higher education. We discuss three hypotheses pertaining to (i) their distributional effects, (ii) their effect on the demand for higher education and study behavior, and (iii) the competition and financial re-sources effects. We utilize a large number of empirical studies and other country experiences to assess likely effects in Germany. We conclude that fees are likely to reduce enrollment modestly and that the existing system of higher education financing is probably regressive. Tuition fees will reduce regressiveness only if they replace tax-financed funding, which conflicts with the objective of increasing resources for universities however. We are sceptical about the latter to happen.