Higher Education Cost Compensation Mechanism

The costs on Education, health care and housing issues have been the "three new heavy burdens" in the minds of people for some time. The continuously soaring tuition of higher education have drawn extensive attention to the standard tuition rate and cost compensation for higher education (CCHE). Definition of CCHE is: who and how to compensate the cost for higher education stemming from fiscal crisis of higher education. The mechanism of CCHE means the composition of various forms of compensation in the system and how all the forms are put into practice. In China there is a mechanism of allocation for educational resources that the cost for higher education is sharing between governments (or taxpayers) and students as well as another entities. At present, the government no longer has free financial system for higher education and raise funding generally through various channels for higher education system with charging the students. CCHE include the objects of compensation, the content of specific compensation costs, subjects of compensation, the forms of compensation, the operation of the system and so on. This paper is focus on the mechanism of CCHE.This paper attempts to research on the CCHE from the perspectives of public, individuals of and other entities of compensation on the basis of diversifying the sources of funding for higher education. The article is divided into six parts:First part is the introduction. It put forward to the issues discussed in entire article and focused the article on costs compensation for public colleges and universities on the basis of research achievements. In the meantime, the main contents of the whole paper are also summarized in this part.In the second part, from a theoretical point of view of public goods, the different forms of compensation according to the attributes of goods are analyzed. And then this part concretely analyzed the higher education based on its merit goods attribute, concluding that students, government and other entities in society, should take certain proportion of compensation in reasonable. Bringing forth the principles of CCHE and on this basis, explained the main forms of compensation for CCHE and methods for the selection of this study: laying a strong foundation for breakthrough point and study methods of the whole article.In the third part, from both theoretical and practical angle, the compensation ratio between public and private forms in the mechanism of CCHE was analyzed. In theoretical analysis, introduced by the principles of economics, explained the best share ratio of the taxation and fees in mathematical expression; and then from a practical point of view, the level of public input, the level of private investment and the capacity of compensation and also the proper trends of both public and private compensation for a reasonable proportion with respect to the bearing capacity of the people were discussed.From the fourth part, the article came to the discussion on some of the specific issues in this paper. Part IV to VI, forms of compensation on public, private and other forms of compensation for the realization of CCHE are given a detailed analysis separately. In every part, firstly, from the realities, I pointed out that there are some problems existing in current mechanism of CCHE in China and analyzed the reasons; thereupon, basing on the analysis of causes, outlined the optimization measures and Countermeasures.