--and potentially more important--all students, even the more highly motivated ones, respond to lower tuition levels by decreasing their …-subsidy, low-tuition policies have both disincentive effects on students' study time and adverse effects on human capital …

individual income data and assume that agents have to consume their endowment. I find that the model does not pass the Hansen and … Jagannathan test even for very volatile idiosyncratic income data. …