Title Who pays, who graduates? Funding mechanisms and other drivers of graduation in the European Union
Authors Židonė-Bylė, Gintarė ; Krušinskas, Rytis
DOI 10.3390/economies13120364
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Is Part of Economies.. Basel : MDPI. 2025, vol. 13, iss. 12, art. no. 364, p. 1-19.. ISSN 2227-7099
Keywords [eng] graduation rates ; higher education funding mechanisms ; performance-based funding ; public investment ; education policy
Abstract [eng] Higher education (HE) funding mechanisms in the European Union (EU) are undergoing substantial reform, with universities facing increasing pressure to improve performance outcomes under constrained public budgets. This study analyses how the design of HE funding mechanisms—specifically, the logic of resource allocation and the principles of performance evaluation, together with the volume of public investment, macroeconomic conditions, and demographic factors—affect graduation rates in the EU. The study uses panel data from 27 EU Member States for the period 2013–2023 and applies multiple regression models with one- to four-year lags to assess the delayed effects of funding and economic factors. The results showed that a larger share of young people in the population and public expenditure per student are positively and statistically significantly associated with higher graduation rates (p 0.05). The most substantial effect was found after two years, confirming the delayed but weakening impact of funding and macroeconomic factors on study graduation rates. The study extends previous work by integrating an analysis of funding design and time dimensions at the EU level. The results emphasise that it is not so much the amount of funding that is important for higher education outcomes, but instead how it is funded—therefore, targeted, student-oriented investments and long-term policy consistency are necessary to achieve higher graduation rates.
Published Basel : MDPI
Type Journal article
Language English
Publication date 2025
CC license CC license description