COMPARISON OF FORMULA FINANCING AND PERFORMANCE-BASED FINANCING METHODS: THE SAMPLE OF HIGHER EDUCATION

Year 2017, Volume: 8 , 52 - 58, 10.12.2017

Gonca Gungor Goksu Mehmet Emin Altundemir

Abstract

When the financing of higher education service with
public resources is examined, it is understood that there are two main
allocation methods as traditional and modern. While input criteria are given
importance in traditional methods, output and results criteria have precedence
in modern methods. Formula financing examined in this study is evaluated among
traditional financing methods. On the contrary, performance-based financing is
also among modern financing methods. The formulas and various indicators are
used in the context of both practices. So the related methods are sometimes
confused and perceived as expressing a similar logical framework. However, the
two methods differ significantly from each other. In this study, the similar
and dissimilar aspects of them are analyzed. Thus, examples are given from
higher education service in order to concretize the subject. In this direction,
the aim of study is to compare to formula financing and performance-based
financing and to comprehensively examine the common features and their
differentiating aspects of the related allocation methods.

Keywords

Higher education financing, performance-based financing, formula financing

References

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