I would like to thank my supervisor, Professor Jake Ansell, for all his support and encouragement during this challenging dissertation period. My gratitude also goes out to all academic and support staff of the MSc Marketing and Business Analysis course for what was an educational stimulating academic year. All the knowledge passed on and assistance given formed a solid foundation that was invaluable during the course of working on this dissertation.
I would like to also like to take this opportunity to extend my appreciation to my family members, course mates and friends, who acted as pillars of strength by continuously keeping check and giving out words of encouragement during the dissertation phase.
ABSTRACT
The nature of the rapidly changing Higher Education (HE) industry has forced universities to implement more innovative marketing strategies. In order to remain competitive, there is a need for universities to not only engage in marketing strategies that are relevant to the existing HE context, but also be aware of foreseeable changes that are taking place to enable them to alter their positions and adapt smoothly without being left behind. This study investigates the marketing strategies employed by the College of Humanities and Social Science at the University of Edinburgh and the relevance of these strategies in the context of the fast-moving HE industry. Three main areas were studied in the literature review- demands of the industry, current marketing philosophies and practices within the industry and trends that likely to shape the future of the industry.
The Term Paper on HunteHunter Boot Marketing Mix Strategies
Marketing strategy is a process that can allow Hunter Boot to concentrate its resources on the optimal opportunities with the goals of increasing sales and achieving a sustainable competitive advantage (Baker M 2008). Marketing strategy includes all basic and long-term activities in the field of marketing that deal with the analysis of the strategic initial situation of Hunter Boot and the ...
A proper understanding of these areas is important as it used as a comparative yardstick to evaluate the College’s existing strategic position and the direction it is heading towards. Qualitative research was used given the exploratory nature of the study that aimed to uncover thoughts, experiences and ideas of respondents. In-depth interview was used as the main research method as there was a specific need to gather detailed information from select-few respondents based on their job expertise. On a smaller scale, focus group interviews comprising students were also conducted as a complementary research to generate their perception and views regarding the Higher Education Industry.
Upon analysis, discussion of the findings was divided into three sections based on their relevance to the research questions and the gaps observed in the literature review. The key findings was that the general philosophy of the College’s marketing is in line with the existing standards expected of the HE, but there is inadequate marketing for undergraduate levels which was brought about by an arguably false interpretation of high demand. The study also shows that there is under-utilization of the role of student ambassador and lack of gender-based marketing, both of which were identified in the literature as important in keeping up with fiercer competition and addressing challenges of the future. In terms of fee structure, high-income household students are expected to pay the largest share of costs because of their ineligibility to apply for most loans and grants. However, they are seen to be willing to pursue HE studies and view it as an investment for a better career.
Low and middle-income household students, although are not affected much at undergraduate level, are likely to seek employment after their studies instead of commencing a postgraduate degree. The findings and analysis brought about several recommendations which include focusing on international marketing to increase the level of international students, hence generating higher revenues that could be channelled at funding purposes for postgraduate level to increase participation of low and middle-income household students. Recommendations for strengthening marketing efforts at undergraduate level, tailoring gender-based marketing and efficient utilization of student ambassador schemes were also provided. The study concludes that while the current marketing philosophy fits the existing context (with exception to undergraduate level), a lot can be done to capitalized on emerging trends to ensure that the College is better prepared to deal with the changes of the future.
The Essay on College Education
College education College Education is Essential A college education is necessary in today's world. Education has been around for thousands of years and college education is one of the most important of them all. College education will prepare one with the understanding to be able to deal in today's problems, obstacles, and jobs. With the knowledge at the college level one will have more potential ...
1.0 CHAPTER ONE: INTRODUCTION
This Chapter will present the purpose of the research, along with the objectives that are aimed to be achieved. It also brings into attention the relevant research questions that the study seeks to answer. The Introduction Chapter concludes with a structure of report to demonstrate the organization and structural design of this study.
1.1 Purpose of Study
The purpose of this study is to analyze the current marketing strategies employed by the University of Edinburgh’s College of Humanities and Social Science and its relevance to the rapidly changing higher education industry, to enhance the knowledge available in existing research and also to set the foundation for further research. Existing research on higher education is vast but there is limited research on contemporary strategies in the fastchanging higher education industry. More importantly, there has been very few studies done on the University of Edinburgh and the Colleges associated with it, in terms of its effectiveness in executing marketing strategies and preparatory measures in dealing with future challenges.
The objectives of this research are:
1) To investigate the relevance of marketing strategies adopted by the College of Humanities and Social Science with regards to the existing context of the Higher Education industry.
2) To investigate the competitiveness of marketing strategies employed by the College of Humanities and Social Science with regards to the foreseeable changes to the Higher Education industry.
In order to do this, there was need to gain a general understanding on the Higher education industry and also the transformations that it has witnessed and are likely to face in the recent future. Upon identifying the underlying and emerging factors that are set to affect the marketing strategies undertaken by the College, the study was limited to a focused area of study and the following research questions were derived:
The Term Paper on Outline And Explain The Marketing Research Process
Marketing research is “the planned and systematic gathering and collation of data and the analysis of information relating to all aspects of marketing and the final consumption of goods or services” -Leader & Krystis. Sometimes a company may want information about its customers, and so will carry out research. The marketing environment is constantly changing and as marketers we ...
1) Are the general marketing philosophies of the University of Edinburgh in line with contemporary standards expected in the Higher Education industry?
2) To what extent are Student Ambassadors being empowered and utilized as a marketing tool to provide the edge in a competitive student recruitment market? 3) Are there initiatives on gender-based marketing to capitalize on the trend of consistently increasing number of female students in Higher Education? 4) How would a new fee-structure, if implemented, affect marketing strategies in recruiting UK, EU and Overseas students?
1.2 Structure of Report
The report is organised as follows:
CHAPTER ONE: Reveals the purpose of the study and central issues that are observed. It moves on to identify the research objectives that the study endeavours to appreciate through the assessment of key research questions (previous section).
CHAPTER TWO: Provides an overview of the Higher Education industry and explores three main section- demands in higher education, contemporary marketing philosophies and practices of the industry, and the higher education fee structure. Each section is concluded by establishing their relevance to the research questions being posed. CHAPTER THREE: Discusses the methodology used in addressing the research questions. This Chapter establishes the reasons for the selection of methods and techniques used, and highlights the limitations in place. It also provides reasons as to why other methods were not employed.
CHAPTER FOUR: Provides findings from the primary research and analysis linking the findings to the literature review. This Chapter is divided into three sections- New-age marketing philosophies of the higher education industry, relationship between tuition fees structure and marketing strategies with regards to recruitment for UK, EU and Non-EU students, and under-utilization of resources to capitalize of emerging trends (student ambassador and gender-based marketing).
The Essay on Students Spend Less Time Studying
College students today spend less time studying. In order to succeed in college, it’s very important to dedicate your time to work hard. Some students do not use their time correctly to study because they get caught in other distractions. Bad grades in college are results of not spending enough time studying. The social media is a time consuming for the college students. Spending an exaggerated ...
It also critically discusses the strengths and weakness of the College’s marketing strategies. Recommendations were also provided in this chapter to counter weaknesses that were observed.
CHAPTER FIVE: Concludes the study and reiterates the summarized findings, analysis and recommendations of the previous Chapter. Areas for future research and research limitations that could be improved on were also highlighted. Note: In this research, ‘College’ would refer to College of Humanities and Social Science, University of Edinburgh. This is distinct from ‘University’ which would refer to the University of Edinburgh as a whole. Although this study is done in the College, the word ‘University’ will be used in some discussion areas which encompass both the College and the University.
2.0 CHAPTER TWO: LITERATURE REVIEW
The Literature review will emphasize on three areas: demands for Higher Education, contemporary marketing philosophies and practices of Higher Education, and Higher Education fee structure. A firm comprehension of these areas will provide a good understanding on the current structure of Higher Education and the direction it is heading towards.
2.1 Demands for Higher Education
The implementation of effective marketing strategies depends significantly on clear understanding of demands within an industry. This section of the literature review aims to look into the patterns seen in demand, from both local and international perspectives, and how they have evolved over the years. It would seek to review motivations that drive demand for higher education and identify emerging trends that could have an effect on future demands in the higher education industry. Such understandings are vital for institutions in continuing to remain competitive and also in laying the foundations to facilitate possible changes in strategies for the future.
Statistical figures show that in 1950, about 50,000 tertiary level students studied in institutions outside their home country (Brickman 1975).
Europe and North America were the most popular continents of study destination and a vast majority of the students were from these regions. In terms of Asian students, few studied away from their home countries and for those who did, the majority followed the colonial path with students from India, the Malay Peninsula and Hong Kong heading to the United Kingdom and ones from Indochina preferring an education in France (Cummings and So 1985).
The Essay on The Challenges Facing International Students in Higher Education
The number of international students studying in the UK has soared over the past decade due to globalization. Paige (1990) defined International students as those individuals who temporarily lived in the foreign countries and received the education as exchanged students. The main reason why international students come to the foreign countries is that they want to receive better education compared ...
Out of a total of 900,000 students who studied abroad in tertiary institutions in 1984, Asian students constituted about 45% of them in 1985. The sharp increase of Asian students was contributed by factors such as increment in income per capita in Asia which made it affordable for them to pursue a degree overseas and also the perception that overseas degrees were viewed as a platform to achieve good employment opportunities. Another contributing factor was the rapid expansion of secondary education in many Asian countries, hence creating more qualified tertiary-level applicants that the local education system could accommodate (Cumming 1984).
Over the last decade, developed countries around the world saw a significant increase in demand for tertiary education and there have been a large volume of research in economic literature to assess and analyze the driving forces that brought about this shift. Albert (2000) states that all these studies lead to one major contributing force that has resulted in high demand for higher education; the positive association between level of education and income and career prospects.
Testing this hypothesis in the UK context, Greenaway and Haynes (2000) reported that an average earning difference between a graduate and a nongraduate stands at £410,000 while Skidelski (2000) through a study using a different methodology projects the figure at £400,000. These figures are supported strongly by the report of UK’s Department of Education and Skill using Labour Force Survey data which estimated a lifetime average differential of £400,000 as well (Greenaway and Haynes 2003).
Therefore, given the similar period in which these studies were done, the UK figures asserts the findings of Albert (2000) whereby there is validity in the perception of association between income and level of education.
Another important finding by Albert (2000) is the role of gender in explaining demand, in which women were noted to be relatively more motivated and inclined than men to demand for higher education on the basis that it would enable them to compete on par with men in career advancement opportunities. This is supported by Broecke and Hamed (2008) in which they stated that although women has been historically under-representation in higher education, statistics show that by 1992, they have caught up with men in terms of participation in England and as of 2008, are ahead of men by 7.2%. In a report submitted to the United Nations, Johnson and Vanderpool (2003) found that in the Carribean, the number of women in higher education outnumber that of men, and in some institutions even show 3.2:1 ratio.
The Essay on Educational institutions have a responsibility to dissuade students from pursuing fields of study in which they are unlikely to succeed
There has always been some times in our lives when we retrace our naive early days that we learn from try-and-error and we can’t stop thinking “how I wish there were mentors in my life who draw me the blueprint of future, point out the right way for me to pursuit and prevent me from making so much immature mistakes”. Therefore, some of us come up with the idea of making it educational ...
It is also estimated that the ratio could go up as high as 8:1 in favour of women. In the United States, the participation of women in higher education increased from 43% in 1971 to 56% in 1997 and the gap continues to widen (United States General Accounting Office 2000).
In the UK context, the numbers of undergraduate female student applicants over the past 3 years have been consistently placed at 56% compared to male student applicants at 44% (see Appendix 1).This trend is of importance to higher education marketing in terms of weighing the importance of gender in relation to the establishment of target groups. While women may be seen as the ones more inclined to embrace higher education, it also indicates that little focus have to be channelled to them in marketing campaigns as compared to males.
In terms of undergraduate students in the UK higher education industry, a significant portion of 88% consists of UK students in 2009/10. This is followed by Non-EU and EU students at 8% and 4% respectively. Figures based solely on undergraduate students enrolled on a full time basis indicate that UK students emerge as the significant front runner with 84% ahead of Non-EU students at 10% and EU students at 6%. As for part-time undergraduate students, UK students are again the majority at 94% followed by Non-EU students at 4% and EU students at 2% (see Appendix 2).
Although the pattern across both these modes of study is quite similar, there is a difference in terms of percentage variation between the 2009/10 enrolments compared to the previous academic cycle of 2008/2009. While all full time students regardless of geographical background recorded a positive variation in enrolment, UK and EU part time students recorded a decrease in enrolment by 3% and 7% respectively. Only Non-EU part-time students registered a positive increment from 2008/09 to 2009/10 with an increase of 6% (HESA 2011).
Sastry (2004) argues that the number of students obtaining postgraduate courses immediately after their undergraduate studies is expected to rise due to the fact that there has been increasing number of graduates over the years. Therefore, as supported by Hesketh and Knight (1999), postgraduate study is viewed as an option for undergraduates to differentiate themselves from the pool of other graduates seeking employment. Non-EU students make up about 43% of overall full-time postgraduate students in UK in 2009/10. This consists of a significant portion of total postgraduate students and the number has nearly doubled in the past seven years, indicating that this is a recent and emerging trend (HESA 2011).
Overall, without taking UK into account, Non-EU students constitute 69% of students at all levels of study (see Appendix 3).
This trend has seen the number of Non-EU students increase by almost 200% from 1995 to 2010. Income received by higher education institutions from Non-EU students during this same period has also increased significantly from £455 million in 1995 to £2,580 million in 2010 (see Appendix 4).
Given that this is now a major market for UK tertiary institutions, there has been a rise in efforts taken to continue reaching prospective students abroad (Hemsley-Brown and Oplatka 2006).
Important factors that come into play when assessing the ability of the UK higher education to remain attractive are the standard and reputation of institutions, the expansion of local education system in countries abroad, particularly China and India, and the competitiveness of the UK market as opposed to other study destinations (Ramsden and Brown 2008).
Employment opportunities in the UK is also a reason for Non-EU students to take up a postgraduate course as students who have studied in the UK for at least one full academic year would be eligible to apply for a Post-Study Work Visa. Guruz (2009) stated that incentives in the form of research grants and employment opportunities abroad are major forces that are considered by foreign students when choosing a study destination. However, it has to be brought into attention that the current UK Government has tightened visa regulations and the Post-Study Work Visa would be abolished in 2012 (The Guardian 2011).
Therefore, the changes in regulation may bring about significant changes to the enrolment of international students in postgraduate courses in the UK. UK students consist of about 45% of the total number of full-time postgraduate students in the region, almost similar to the number of Non-EU students. However, UK students make up 82% of the part-time postgraduate students in 2009/10 (HESA 2011).
This is partly due to the fact that the high postgraduate fees require students to work in order to finance themselves. Other contributing reasons include company scholarship and students not wanting to leave their jobs in times of economic turmoil (Jongbloed 2003).
EU students make up about 12% of full time postgraduate students, with most of its students coming from the new countries admitted into EU since 2004. However, increasing or perhaps even retaining the current level of enrolment of EU students may be a challenge as projections show that the population of 1830 year olds in EU are set to fall by 14% over the next 20 years. Of the new countries admitted into the EU in 2004, it is projected that their combined population of 18 year olds will decrease by a significant 37%, from 1.5 million in 2007 to 1 million in 2027 (Ramsden and Brown 2008).
Reviewing this section shows that there is an increasing number of Non-EU students, particularly Asians, opting to study out of their home countries. Overall, over the years, there are a growing number of students who embark on higher education and one of the major contributors to this is the positive association between level of education and career prospects. The secondary research also reveals that although the majority of undergraduate students come from the UK, most of the postgraduate students in the UK are made up of Non-EU students. The trend of growing number of female students in the higher education industry was also observed.
2.2 Contemporary Marketing Philosophies and Practices of Higher Education
In order to remain relevant in rapidly changing industry, it is important for institutions to keep abreast with current needs of the market and changes that are required of the industry to remain competitive. Therefore, this section of the literature review attempts to assess the paradigm shift of traditional higher education marketing to contemporary strategies required by the industry and also look at key areas that could be fully utilized to enhance the efficiency of higher education marketing campaigns. The marketing of higher education needs to encompass the traditional emphasis on product, place, price and promotion but also include people, process and physical evidence through a service-oriented marketing approach which gives due credence to the value of the intangible and inseparable.
In this context, the components of people, process and physical evidence have been altered slightly to represent a more appropriate connotation in regards to the higher education industry. Newman and Jahdi (2009) described people as ‘calibre’ or ‘champions’ whereby such human qualities in an institution would be pivotal in attracting students. This echoes the view held by McGrath (2003) in which a positive correlation between the development of education market and high priority on variables such as managerial competence, role-model associations and performance. The component of process has been defined as ‘capability’, where issues such as communication between the institution and prospective student, relationship marketing and enrolment procedures should be handled efficiently to gain competitive advantage.
Newman and Jahdi (2009) further asserts that considerations as small as publicising opening hours for consulting and enrolment purposes as well as offering refreshments could, once combined, prove to be the ‘added value’ that would inevitably enhance the end service that is being marketed. The final component, physical evidence was represented by ‘charisma’, whereby elements such as geographical location, facilities and amenities are taken into account. Factors such as history and heritage of a location and the tradition of graduation ceremonies could provide a sense of identity that students would take pride in being associated with the institution (Roper and Davies 2007).
However, Newman and Jahdi (2009) stated that the implementation of marketing mix could potentially lead to adverse consequences as marketing rhetoric may not necessarily always reflect educational reality.
They go on to state that although there are indications that higher education marketers have started to take the leap into focusing on people, process and physical evidence, these elements need to be expanded to include contemplation and thoughts of higher education from staff and students as this would be able to minimize the mismatch of the marketing rhetoric and the reality of the environment. Critically, Newman and Jahdi (2009) also argued that knowledge and skills acquired in tertiary educational institutions should not be conveniently marketed as mere commodities that are to be sold as predetermined packages to those who have been targeted. Instead, there should be a genuine attempt to convey that education is a challenging industry that would require effort and planning by students, hence projecting the reality.
Evans (2004) holds similar views about the need to craft a marketing effort that is as close to reality as possible, particularly given the context of the current climate whereby effectiveness, quality, competition and evaluation are a matter of public discourse and information are widely available and easily accessed. This is supported by Crosby et al. (1991), in their argument that a false representation in marketing could lead to adverse effects and negatively impact upon the credibility of an institution. Therefore, although not predominantly derived from a moral standpoint, the need to eliminate unsubstantiated benefits and other positive associations with an institution is vital in terms of marketing implications as failure to appreciate this growing issue may cause an institution’s credibility being put to question.
Student ambassadors are very much part of UK higher education institutions and they have been known to assist in marketing efforts of their respective universities, predominantly via engagement with prospective students through campus tours. In recent times, student ambassadors have widened their scope of marketing operations and have now extended their services through handling multiple tasks, which include organizing residential summer schools to help prospective students to gain insights into university lifestyle in hope that this would encourage them to take up higher education courses. Another new area embarked by student ambassadors is their participation in mentoring activities, particularly for the disadvantaged youths (Ylonen 2010).
These recent expansion in their activities have been encouraged the former Labour government’s initiative to expand participation in higher education for groups that are under-represented through its Aimhigher programme. In analyzing the relationship between higher education decision-making amongst the young and the role played by student ambassadors in this aspect, Gartland and Pacsuzka (2007) found that student ambassadors who are deemed trustworthy by prospective students could play a key role in widening their participation gap as prospects are more likely to consider them as a preferred choice of contact point when making further enquiries, especially if they do not have a family background in higher education. This is supported by Reay et al. (2005) in their argument that information gathered through relationships and networks are taken more seriously compared to ones obtained from official sources such as prospectuses and the Internet.
Therefore, student ambassadors can potentially be seen as mediators and their interventions would greatly influence decisions made by prospects. Taylor (2008) argued that one of the challenges faced in institutions is to connect the territories of academia and school environment and hence, the role of a student ambassador fits in well as although they speak from the standpoint of the institution, there is not much difference in the age bracket between both these groups and this would create a more casual and appropriate comfort zone for prospective students to engage in. This finding is particularly relevant to marketers in determining the age group of candidates to be selected as student ambassadors, given that they consist of not only undergraduates but also mature postgraduate students.
In a study of an Aimhigher programme in south-east London, Ylonen (2010) found that most student ambassadors had very vague ideas of what they thought their tasks would be like and many of them stated that their expected roles as perceived during training and their actual roles were very different. Although they generally had sound knowledge of higher education lifestyle and its environment, many lacked the thorough knowledge of procedures that occur within an institution, such as financial issues.
Coordinators, most of whom are marketing officers within their respective universities, have also noted that many potentially good student ambassadors failed to apply because they did not see themselves to fit into the characteristics set by the coordinators (Terion and Leonard 2007).
These weaknesses are of relevance to higher education marketing units as contemporary research suggests that despite having a valuable student capacity in the form of student ambassadors, their potentials are being under-utilized due to administrative and training setbacks. The flaws seen in this system is viewed to be largely due to the fact that there isn’t a national model of the student ambassador scheme to be used as a guideline and all higher education institutions are expected to craft and implement their strategies independently. Although it is important to have flexibility and a certain degree of autonomy, a scheme without guidelines can arguably be go astray and lose its sense of direction (Ylonen 2010).
Literature in this area of study reveals that in terms of higher education marketing, there should be a focus on service-oriented marketing through an innovation of the extended 4Ps, which would include the elements of ‘calibre’, ‘capability’ and ‘charisma’. Apart from that, it also indicates that the growing importance of the role of student ambassadors have gone large unrecognized. Despite them being available in most universities, there is a lack of effective utilization of these roles.
2.3 Higher Education Fee Structure
The future of higher education in the UK has been put into uncertainty by the recent changes in tuition fees policy and many are unsure as to how these changes would impact on demands by students across levels of households. Although the changes have been made effective in England and Wales, the Scottish Government has yet to make an official announcement on this issue. However, a comprehensive review of the changes that have been taking place in the fee-structure and how it has affected the industry as a whole and demand, in particular would enable higher education marketers to prepare for the changes that although unclear, appear to be imminent.
The financing of the higher education industry has been a subject of debate for the past five decades and had been given high priority by successive governments, regardless of political inclinations. During this phase, there has been a shift from a fully-funded taxpayer scheme to a ‘cost-sharing’ system, whereby students are required to cover a certain portion of their tuition fees (Dearden et al. 2010).
The change of system sparked a wide range of concerns, particularly the reservations that it would lead to a lower level of participation (Connor and Dewson 2001).
The introduction of the 1998 Teaching and Higher Education Act was the first significant change made to the higher education financing structure as it marked the unprecedented introduction of tuition fees at a cap of £1,000 a year for degree courses (Claire and Jonathan 2005).
Maintenance grants that were previously offered were reduced in stages and later eliminated only to be replaced with maintenance loans which were established in 1999 (Christie and Munro 2003).
The 2004 Higher Education Act paved way for another significantly policy to be put in place in 2006, which saw the implementation of deferred fees which was applicable to all students, regardless of economic background (Harrison 2011).
The new fee had a cap of £3,000 and universities had the prerogative to decide the amount to charge each student (Dearden et al, 2004; 2005).
Fee loans were provided, only to be repaid by students after graduation if they’re earnings were above £15,000. Apart from that, the 2004 Higher Education Act also reinstalled maintenance grants which were to be distributed to poor students (Harrison 2011).
In the year 2006, the value of this grant was significantly increased. As a result of the introduction of tuition fees along with the substitution of maintenance grants with loans, many argued that it would not only lower participation but also be discriminative against students from lower-income households (Dearden et al. 2010).
On the contrary, there were also proponents of the new system who claimed that requiring student to contribute to their studies would instil a sense of responsibility in them and hence, at a larger scale, increase efficiency and quality of higher education (Greenaway and Haynes, 2003; Goodman and Kaplan, 2003).
Apart from that, the benefits gained by higher education in terms of wages and salary brackets would offset the negative impact caused by the introduction of tuition fees. Another advantage of imposing tuition fees is that only students who are committed on acquiring skills and knowledge would enrol into institutes and not ones who wish to have prolonged ‘laddish’ times, hence in a way addressing the issue of youth unemployment (Lange 1998).
It is also interesting to note that in the UK, government spending on higher education continues to grow despite larger share of financial burden being
on placed students as shown by 2007 figures whereby £918m, £349m and £564m were spent on maintenance grants, student fee loans and maintenance loans respectively (Dearden et al. 2010).
In 2010, another significant policy change was made to the higher education financing structure in England and Wales, whereby the upper tier for tuition fees was increased from £3,000 to £9,000 (BBC 2010).
While poorer students would be protected by a large number of scholarship and bursaries, students from middle and high-income households would be the group that is most negatively affected (Directgov 2011).
Highly successful students who go on to land high paying jobs would also be affected as they would be required to pay loan amounts that are significantly higher than those with average incomes (The Guardian 2010).
In the case of Scotland, the Cubie committee was formed in 1999 following the Scottish devolution to look into the higher education financing. The Cubie Report (2000) proposed that an endowment scheme be put in place and through the Education (Graduate Endowment and Student Support) (Scotland) Act 2001, students were required to pay £2,000 when their annual earnings reached £10,000. The repayment was later raised from £2,000 to £2,289 for students commencing their studies in 2006/07 academic period (The Cubie Report 2000).
However in 2007, the government tabled the Graduate Endowment Abolition (Scotland) Bill which aimed at scraping the endowment scheme and the move was approved in 2008, hence restoring free education in Scotland (BBC 2008).
Based on the United States context, Kent (1994) studied the relationship between the state’s public spending on higher education and the impact of tuition fee costs on higher education participation. The finding was that $1,000 increase in tuition fees would bring about a 3.7ppt reduction in participation among African Americans. On a wider scale, Kent (1995) found that there was a reduction in participation among Americans in higher education, in which a $1,000 increase in fees resulted in a 2.4 decrease in participation. On assessing a policy made in 1982 which led to financial aids being removed from students with deceased, disabled or retired father, Dynarksi (1999) found that the impact of aid withdrawal led to decrease tertiary participation by 3.6ppt.
Supporting this finding is a study done by Seftor and Turner (2002), whom upon analysing the impact of aid withdrawal, found a small impact of reduction in participation by 0.7ppt per $1,000 of aid withdrawn. The UK context of higher education financial constraint on students and its effects on participation can be viewed at two separate phases; the 1998 reforms and the 2006 reforms as described earlier. The 1998 reforms, in terms of grants alone, saw low income students being the most significantly impacted, with participation estimated at 2.3ppt lower than what it would have been without the abolishment grants (Dearden et al. 2010).
On the other hand, the increase in loans received by this group resulted in an increase in participation and hence, offset the negative impact brought about by the abolishment of grants. Therefore, there were no significant changes to participation for the lower income group. High income students, however, recorded a reduction of 5.4ppt in participation as even though the abolishment of grants had no impact on them, the increment of tuition fees was a significant impact (Dearden et al. 2010).
Study on the 2006 reforms showed that both the lower and higher income groups did not record overall changes in participation (Forsyth and Furlong 2003).
Therefore, this section of the literature indicates that despite concerns by many that an increment in tuition fees can be discriminatory towards lower income groups, studies have shown that the negative impact brought by the hike in fees are often outweighed by grants or loan packages. This also brings about serious implications to higher education institutions on deciding the type of financial assistance and the accurate target groups to ensure that participation does not see an unhealthy dip. Such a consequence could be detrimental to the economy of the country as many research seem to suggest that the economic well being of a nation state is directly associated with the level investments spent on education (Barro and Sala-i-Martin, 1995; Bassanini and Scarpenta, 2001).
