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Where Is Aggressive Price Competition Taking Higher Education? Discussion Paper.

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Bibliographic Details
Title: Where Is Aggressive Price Competition Taking Higher Education? Discussion Paper.
Language: English
Authors: Winston, Gordon C, Zimmerman, David J., Williams Coll., Williamstown, MA.
Peer Reviewed: N
Page Count: 28
Publication Date: 2000
Sponsoring Agency: Andrew W. Mellon Foundation, New York, NY.
Document Type: Reports - Research
Descriptors: Competition, Costs, Educational Finance, Enrollment, Higher Education, Inflation (Economics), Institutional Characteristics, Low Income Groups, Paying for College
Abstract: This study attempted to understand how price competition would work in higher education and to explore the likely long run equilibrium structure of prices in that context. Inferences are drawn using both microeconomic theory and historical parallels found in the market for graduate education. The analysis suggests that negative prices are likely to prevail at the wealthiest colleges and universities. Using data from the Integrated Postsecondary Education Data System (IPEDS), the study estimated the resulting distribution of prices and school quality. While price competition may increase attendance by low income students at the wealthiest colleges and universities, it is unclear how these students will fare at schools with middling wealth and resources. Schools with less accumulated wealth will be particularly vulnerable to any ensuing price competition. While these conclusions must be interpreted with caution, they do suggest some cause for alarm. (Contains 3 tables and 11 references.) (SLD)
Entry Date: 2003
Accession Number: ED474474
Database: ERIC
Description
Abstract:This study attempted to understand how price competition would work in higher education and to explore the likely long run equilibrium structure of prices in that context. Inferences are drawn using both microeconomic theory and historical parallels found in the market for graduate education. The analysis suggests that negative prices are likely to prevail at the wealthiest colleges and universities. Using data from the Integrated Postsecondary Education Data System (IPEDS), the study estimated the resulting distribution of prices and school quality. While price competition may increase attendance by low income students at the wealthiest colleges and universities, it is unclear how these students will fare at schools with middling wealth and resources. Schools with less accumulated wealth will be particularly vulnerable to any ensuing price competition. While these conclusions must be interpreted with caution, they do suggest some cause for alarm. (Contains 3 tables and 11 references.) (SLD)