Economic Determinants of Participation Rates in University Education

Participation rates in higher education (HE) are an important indicator to pursue one of the main European policy objectives, which is to increase the proportion of population attending HE. A model used to detect the determinants of participation rates is proposed in this paper, and it is empirically tested for 14 European countries through a five-year panel regression. The model considers the potential explanative factors as follows: the country's socio-economic conditions, human capital stock, organization of the HE sector, HE expenditure. The results show the important role of financial resources devoted to HE; but also, as expected, the influence of other factors. More specifically, there is a role for the variables related to HE organization and structure, also confirming that higher entry rates is influenced both by an improvement in public investments in the sector and by organizational elements. These findings are relevant for policy purposes, since they suggest possible solutions for improving participation rates. Some results therefore deserve more theoretical reflection on this theme - findings about the role effect of income inequality, for instance, are quite counterintuitive and deserve more attention in future research. Finally, the overall level of spending is the key element which mainly influences entry rates; therefore, in periods of public finance pressure, the best way to resolve this problem could be to improve private resources