Title: Government financial assistance in higher education: an empirical analysis of efficiency in Australian universities

Authors: Carolyn Thi Thanh Dung Tran; Jerrie Ngoc Nhu Binh Tran

Addresses: Australian Institute of Higher Education, 545 Kent Street, Sydney, 2000, Australia; Business School, University of New England, Armidale, NSW 2351, Australia; University of Sydney, Camperdown NSW 2050, Australia; University of Technology, Sydney, 15 Broadway, Ultimo NSW 2007, Australia; Western Sydney University, Sydney NSW 2000, Australia ' University of Newcastle, University Dr, Callaghan NSW 2308, Australia

Abstract: Government financial assistance (GFA) plays an important role in higher education to facilitate the process of teaching, learning and research of staff and students. However, very little is known about efficiency of using GFA in higher education. This paper aims to investigate efficiency of using GFA in Australian universities in the context of substantial variation in public funding distribution. The stochastic frontier input requirement model was developed to measure efficiency of using GFA for 2009-2016. The findings reveal that the overall efficiency of using GFA on average at 0.956, implying a high level of efficiency in using public funding. However, bigger is not better in the performance of universities through using GFA. In addition, contextual factors potentially influence temporary transient efficiency (0.974), other than long-term managerial efficiency (0.982) decomposed from the overall efficiency index of GFA. Some suggestions are made for more appropriate solutions to funding distribution in Australian universities.

Keywords: Australia; higher education institution; long-term efficiency; transient efficiency; government financial assistance; GFA; stochastic frontier analysis; SFA.

DOI: 10.1504/IJEED.2025.147028

International Journal of Education Economics and Development, 2025 Vol.16 No.3, pp.339 - 357

Received: 06 Oct 2023
Accepted: 24 Oct 2023
Published online: 10 Jul 2025 *