Why have UK universities become more indebted over time?

Adrian Bell, Chris Brooks*, Andrew Urquhart*

*Corresponding author for this work

Research output: Contribution to journalArticle (Academic Journal)peer-review

3 Citations (Scopus)
35 Downloads (Pure)


Media reports of a financial apocalypse facing some UK universities were rife around the onset of the covid-19 pandemic, with much of the blame for their apparently perilous monetary situation levelled at excessive borrowing. This study examines the extent to which higher education institutions in the UK have become more indebted over the past decade and determines the factors that explain why some universities have borrowed more than others. We find that universities with vice chancellors who are older, higher paid, and who have been in their roles for a shorter time, on average have greater levels of indebtedness. We do not observe significant relationships with institutional borrowing for the gender of the vice chancellor, or their previous experience as a deputy vice chancellor or having previously held the top role elsewhere. Among university characteristics, only the level of total assets has any explanatory power for indebtedness, and not its overall institutional ratings score, whether it is a member of the Russell Group, or its total number of students.
Original languageEnglish
Pages (from-to)771-783
Number of pages13
JournalInternational Review of Economics and Finance
Early online date11 Aug 2022
Publication statusPublished - 1 Nov 2022

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