ERIC Number: ED104185
Record Type: RIE
Publication Date: 1974-Aug
Reference Count: 0
The Measurement of Economic Well-Being in Need Analysis Models. ACT Research Report No. 66.
Goggin, W. J.
The equitable distribution of aid funds is viewed in this paper as a problem in taxation according to ability to pay or economic well-being. This approach is emphasized because it is fruitful to consider the various financial need analysis models as systems of taxation that result in the parents' expected contribution to the postsecondary education of their dependents. However, this study deals with only the first step in the development of an equitable tax system, the construction and evaluation of an objective index of ability to pay or economic well-being. Accordingly, a simple two-step model is suggested for evaluating alternative measures of economic well-being. The first step is a comparison of the theoretical implications of competing measures. The second step is a comparison of the implications of each measure for the perceived distribution of economic well-being among aid applicant families. It is concluded that received economic theory can be useful in analyzing the implications of measuring economic well-being in alternative ways. However, a theoretical investigation raises as many questions as it answers. The choice of a measure of economic well-being involves many arbitrary assumptions and value judgments. Received theory is valuable primarily in identifying the truly normative aspects of models used to assess economic well-being and in pinpointing the consequences of assumptions and value judgments. (Author/MJM)
Descriptors: Educational Economics, Educational Finance, Family Income, Financial Needs, Financial Support, Higher Education, Models, Postsecondary Education, Statistical Data, Tax Allocation, Tax Rates, Taxes
ACT Publications, P. O. Box 168, Iowa City, Iowa 52240 ($1.00)
Publication Type: Reports - Research
Education Level: N/A
Authoring Institution: American Coll. Testing Program, Iowa City, IA. Research and Development Div.