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Can Online Learning Bend the Higher Education Cost Curve?

Author

Listed:
  • David J. Deming
  • Claudia Goldin
  • Lawrence F. Katz
  • Noam Yuchtman

Abstract

We examine whether online learning technologies have led to lower prices in higher education. Using data from the Integrated Postsecondary Education Data System, we show that online education is concentrated in large for-profit chains and less-selective public institutions. We find that colleges with a higher share of online students charge lower tuition prices. We present evidence of declining real and relative prices for full-time undergraduate online education from 2006 to 2013. Although the pattern of results suggests some hope that online technology can "bend the cost curve" in higher education, the impact of online learning on education quality remains uncertain.

Suggested Citation

  • David J. Deming & Claudia Goldin & Lawrence F. Katz & Noam Yuchtman, 2015. "Can Online Learning Bend the Higher Education Cost Curve?," American Economic Review, American Economic Association, vol. 105(5), pages 496-501, May.
  • Handle: RePEc:aea:aecrev:v:105:y:2015:i:5:p:496-501
    Note: DOI: 10.1257/aer.p20151024
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    References listed on IDEAS

    as
    1. David J. Deming & Noam Yuchtman & Amira Abulafi & Claudia Goldin & Lawrence F. Katz, 2016. "The Value of Postsecondary Credentials in the Labor Market: An Experimental Study," American Economic Review, American Economic Association, vol. 106(3), pages 778-806, March.
    2. David J. Deming & Claudia Goldin & Lawrence F. Katz, 2012. "The For-Profit Postsecondary School Sector: Nimble Critters or Agile Predators?," Journal of Economic Perspectives, American Economic Association, vol. 26(1), pages 139-164, Winter.
    3. William G. Bowen & Matthew M. Chingos & Kelly A. Lack & Thomas I. Nygren, 2014. "Interactive Learning Online at Public Universities: Evidence from a Six‐Campus Randomized Trial," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 33(1), pages 94-111, January.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Benjamin Faber & Rosa Sanchis-Guarner & Felix Weinhardt, 2015. "ICT and Education: Evidence from Student Home Addresses," SERC Discussion Papers 0186, Spatial Economics Research Centre, LSE.
    2. Hemelt, Steven W. & Stange, Kevin & Furquim, Fernando & Simon, Andew & Sawyer, John E., 2018. "Why is Math Cheaper than English? Understanding Cost Differences in Higher Education," IZA Discussion Papers 11968, Institute of Labor Economics (IZA).
    3. Joshua Goodman & Julia Melkers & Amanda Pallais, 2019. "Can Online Delivery Increase Access to Education?," Journal of Labor Economics, University of Chicago Press, vol. 37(1), pages 1-34.
    4. Lynne Pepall & Dan Richard, 2014. "Competition, Selectivity and Innovation in the Higher Educational Market," Discussion Papers Series, Department of Economics, Tufts University 0782, Department of Economics, Tufts University.
    5. Doyle, William R. & Skinner, Benjamin T., 2016. "Estimating the education-earnings equation using geographic variation," Economics of Education Review, Elsevier, vol. 53(C), pages 254-267.
    6. repec:eee:chieco:v:51:y:2018:i:c:p:194-207 is not listed on IDEAS
    7. Caroline M. Hoxby, 2017. "Online Postsecondary Education and Labor Productivity," NBER Chapters,in: Education, Skills, and Technical Change: Implications for Future U.S. GDP Growth, pages 401-460 National Bureau of Economic Research, Inc.
    8. Nick Huntington-Klein & James Cowan & Dan Goldhaber, 2017. "Selection into Online Community College Courses and Their Effects on Persistence," Research in Higher Education, Springer;Association for Institutional Research, vol. 58(3), pages 244-269, May.
    9. Cacault, M. Paula & Hildebrand, Christian & Laurent-Lucchetti, Jérémy & Pellizzari, Michele, 2019. "Distance Learning in Higher Education: Evidence from a Randomized Experiment," IZA Discussion Papers 12298, Institute of Labor Economics (IZA).
    10. Gilbert E. Metcalf & James Stock, 2015. "The Role of Integrated Assessment Models in Climate Policy: A User's Guide and Assessment," Discussion Papers Series, Department of Economics, Tufts University 0811, Department of Economics, Tufts University.
    11. repec:spr:reihed:v:59:y:2018:i:7:d:10.1007_s11162-017-9490-y is not listed on IDEAS
    12. Michael S. McPherson & Lawrence S. Bacow, 2015. "Online Higher Education: Beyond the Hype Cycle," Journal of Economic Perspectives, American Economic Association, vol. 29(4), pages 135-154, Fall.
    13. repec:jtc:journl:v:2:y:2018:i:2:p:104-114 is not listed on IDEAS
    14. repec:spr:reihed:v:59:y:2018:i:8:d:10.1007_s11162-018-9495-1 is not listed on IDEAS
    15. repec:eee:injoed:v:58:y:2018:i:c:p:5-17 is not listed on IDEAS

    More about this item

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions

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