Regulation in the Market for Education and Optimal Choice of Curriculum
AbstractWe analyze educational institutions’ incentives to set up demanding or lax curricula in duopolistic markets for education with endogenous enrolment of students. We assume that there is a positive externality of student achievement on the local economy. Comparing the case of regulated tuition fees with an unregulated market, we identify the following inefficiencies: Under regulated tuition fees schools will set up inefficiently lax curricula in an attempt to please low-quality students even if schools internalize some of the externality. On the other hand, unregulated schools set up excessively differentiated curricula in order to relax competition in tuition fees. Deregulation gets more attractive if a larger fraction of the externality is internalized.
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Bibliographic InfoPaper provided by Department of Economics, University of Konstanz in its series Working Paper Series of the Department of Economics, University of Konstanz with number 2011-16.
Length: 38 pages
Date of creation: 24 May 2011
Date of revision:
Other versions of this item:
- Eisenkopf, Gerald & Wohlschlegel, Ansgar, 2012. "Regulation in the market for education and optimal choice of curriculum," Journal of Urban Economics, Elsevier, vol. 71(1), pages 53-65.
- Gerald Eisenkopf & Ansgar Wohlschlegel, 2011. "Regulation in the Market for Education and Optimal Choice of Curriculum," TWI Research Paper Series 64, Thurgauer Wirtschaftsinstitut, Universität Konstanz.
- I28 - Health, Education, and Welfare - - Education - - - Government Policy
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-05-30 (All new papers)
- NEP-EDU-2011-05-30 (Education)
- NEP-LAB-2011-05-30 (Labour Economics)
- NEP-REG-2011-05-30 (Regulation)
- NEP-URE-2011-05-30 (Urban & Real Estate Economics)
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