“Why is the government cutting university funding? I ask, because if you believe conventional economics, and the justification for expanding universities in the first place, the cuts might be counter-productive. This is because lower investment in human capital means that people will earn less in future – either because they were denied a university place or because they got a worse education at university. This will mean lower future tax revenues. It could be, therefore, that cutting university spending would merely reduce public borrowing this year, at the expense of higher borrowing in future years …” (more)
[Stumbling and Mumbling, 13 February]