Too Much to Die, Too Little to Live Unemployment, Higher Education Policies and University Budgets in Germany

Journal of European Public Policy, Vol. 14, No. 4, pp. 631-653, June 2007

34 Pages Posted: 22 Dec 2006 Last revised: 24 Oct 2011

See all articles by Thomas Pluemper

Thomas Pluemper

Vienna University of Economics and Business - Department of Socioeconomics; University of Essex - Department of Government

Christina J. Schneider

University of California, San Diego; Max Planck Institute for Economics

Date Written: December 1, 2006

Abstract

German educational spending per student has dramatically declined since the early 1970s. In this paper, we develop a theory of fiscal opportunism and argue that state governments exploit higher educational policies as an instrument of active labor market policy. By 'opening' universities to the masses and the extensive propagation of broader university enrollment during times of economic distress, state governments have an instrument at their disposal for lowering unemployment without generating negative budgetary implications. Thereby, the government pockets voter support not only by diminishing unemployment, but also by providing public goods particularly to the socially disadvantaged. We test our theoretical claims for the German states in a period ranging from 1975 to 2000 by means of panel fixed-effects models.

Keywords: Unemployment, Higher Education, University Budgets, Germany

JEL Classification: H19, H40, H73, P17

Suggested Citation

Plümper, Thomas and Schneider, Christina J., Too Much to Die, Too Little to Live Unemployment, Higher Education Policies and University Budgets in Germany (December 1, 2006). Journal of European Public Policy, Vol. 14, No. 4, pp. 631-653, June 2007, Available at SSRN: https://ssrn.com/abstract=953134

Thomas Plümper (Contact Author)

Vienna University of Economics and Business - Department of Socioeconomics ( email )

Vienna
Austria

University of Essex - Department of Government ( email )

Wivenhoe Park
Colchester, Essex CO4 3SQ
United Kingdom

HOME PAGE: http://www.polsci.org/pluemper

Christina J. Schneider

University of California, San Diego

9500 Gilman Drive
Mail Code 0502
La Jolla, CA 92093-0112
United States

Max Planck Institute for Economics ( email )

Kahlaische Strasse 10
D-07745 Jena, 07745
Germany

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