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"Volatility in State Spending for Higher Education focuses on how much volatility there is in the fiscal relationship between states and institutions of higher education and addresses some of the consequences of this uncertainty. The book begins with a foreword, an editor's introduction, followed by three thematic sections that focus on duration and impact on economic performance and political determinants; financing policies for predictability; and state funding unpredictability. The book should inspire future research on volatility in state support for higher education. Volatility will likely remain a perennial issue and a 'wicked' problem that will require creative and dedicated minds to manage and research"--

This article considers trends in state policies that determine college affordability, including trends in state general appropriations, institutional tuition and fees, and state student financial aid. Taken together, these trends demonstrate erosion in college affordability. This article also examines one recent federal policy intervention that has shaped state policy for higher education affordability, the American Recovery and Reinvestment Act of 2009 (ARRA). My analysis of ARRA shows that the "maintenance of effort" provision in the law was effective, as there was no drop in state general appropriations for higher education (including federal ARRA funds) following implementation. However, in a related analysis, I show that ARRA is negatively associated with state spending on student financial aid. Collectively, state policy trends and the ARRA analyses underscore the need for improved state policy in promoting college affordability, as an affordable college education is out of reach for an increasing proportion of students.

Since 2012, at least 24 states have considered legislation on Pay It Forward (PIF) models of higher education finance (which enable students to pay the price of college upon departure from an institution, as opposed to paying upfront tuition). This paper proposes a theoretical model of PIF policies within a framework in which voters belonging to different income groups vote over the level of subsidies to higher education. We analyze the impact of two types of potential PIF policies—a deferred tuition approach and an income share approach—on college access and on voting equilibria over subsidy levels. The results show that college access is enhanced by PIF policies. The equilibrium level of subsidies depends crucially on the pattern of income distribution, in particular on the relationship between mean income and the income of the median income group, and on whether higher education widens or narrows the distribution of income. We show that the equilibrium level of subsidies to higher education will not necessarily decline under PIF, and may increase in some circumstances due to changes in college access for low‐income groups. (JEL I22, I23)