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Patterns of government subsidies to higher education in five European countries are considered in order to provide a comparative perspective for U.S. policy-makers. Attention is focused on patterns of subsidizing both institutions and students for the five countries: France, West Germany, the Netherlands, Sweden, and the United Kingdom. The subsidies are assessed in light of stated government objectives, and especially the objectives of efficiency and equity. Profiles of the countries includes information on: financing public and private institutions, free education vs. tuition and fee charges, organizational body responsible for budget development; sources of university income; types of student aid and their distribution; maximum award per student, December 1974; tax relief or family allowances for students' parents; indirect student aid (housing, food subsidies, health); interest rate on loans; and loan repayment. Implications of alternative patterns of subsidy are analyzed in depth, with attention to the optimum levels of subsidy, the case for aiding students by means of grants, whether the subsidy system creates equality of educational opportunity, and how costs of education should be shared between high and low income taxpayers. An ideal student aid package is proposed. (SW)

An attempt is made to explain the intricacies of British higher education finance in language that is meaningful to an American audience. After a brief description of the bases of the British system, the following issues that have been subject to recent public debates in Britain are considered: (1) the finance of Oxford and Cambridge; (2) the independent university; (3) the open university; (4) grants versus loans; (5) fees for foreign students; (6) the pool for public sector funding; and (7) the financing of student unions. The autonomous sector of British higher education, consisting of 47 self-governing universities, receives almost 95 percent of its income from the central government in the form of a regular annual grant. The maintained sector, consisting of about 800 publicly-owned institutions administered by local governments, is financed by local authorities, which in turn receive two-thirds of their income from the central government. It is suggested that high costs at Cambridge and Oxford are associated with the collegiate system, or federation of some 30 colleges, and the associated emphasis on teaching by small tutorials. (SW)