The linkage between household and government expenditure on higher education: Examining the Indian case

Abstract

Drawing on National Sample Survey unit level data on India, the article estimates coefficients of elasticity to examine three important questions on the nature of household expenditure on higher education in India - (a) whether households complement or substitute government's efforts in spending on Higher education? (b) how do households behave in spending on education, given a change in their levels of income and finally (c) whether stipends/scholarships shoulder the burden on households. The results indicate that there is a complementary relationship between household and government expenditures on education; and that household expenditures respond favourably but less than proportionately to changes in household incomes. Further, the study also shows that stipends or scholarships play pivotal role in households' decision making regarding the resource allocation for higher education.