Enrolments in higher education: do economic incentives matter?

Abstract

This article analyses the determinants of participation in higher education in Germany, with a particular focus on the role of expectations regarding the cost and the return of higher education. The results show that the enrolment probability is mainly influenced by social origin, even though it also depends on cost and return expectations. In particular, a high unemployment risk and a high expected wage premium seem to increase the enrolment probability, while a higher propensity of non‐ or part‐time employment decreases it. Moreover, extending the coverage of public financial support seems to be more efficient in increasing enrolments than raising the amount granted per beneficiary.