Education Policy | Brookings
A few private colleges have huge endowments, leading to comparisons with hedge funds. A tax was introduced in 2017 for colleges with large endowments, but only 33 schools were affected. The debate centers on whether these endowments benefit low- and middle-income students. Highly endowed colleges spend more on students and charge lower prices for lower-income families. However, the share of lower-income students at these colleges is small and slowly growing. These colleges should do more to improve access, and failure to do so could justify an endowment tax….