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Cost Structure, Efficiency and Heterogeneity in US Higher Education: An Empirical Analysis

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  • T Agasisti
  • G Johnes

Abstract

We estimate a variety of models to evaluate costs in US higher education institutions. A novel feature of our approach involves the estimation of latent class and random parameter stochastic frontier models of the multiproduct cost function. This allows us fully to accommodate both the heterogeneity of institutions and the presence of technical inefficiencies. Our findings suggest that global economies could be achieved by effecting a reduction in the number of institutions providing undergraduate instruction, while increasing the number of institutions engaged in postgraduate activity.

Suggested Citation

  • T Agasisti & G Johnes, 2009. "Cost Structure, Efficiency and Heterogeneity in US Higher Education: An Empirical Analysis," Working Papers 599308, Lancaster University Management School, Economics Department.
    • Handle: RePEc:lan:wpaper:599308
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    References listed on IDEAS

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    Cited by:

    1. Agasisti, Tommaso & Barra, Cristian & Zotti, Roberto, 2016. "Evaluating the efficiency of Italian public universities (2008–2011) in presence of (unobserved) heterogeneity," Socio-Economic Planning Sciences, Elsevier, vol. 55(C), pages 47-58.
    2. Cristian Barra & Roberto Zotti, 2017. "Investigating the Human Capital Development–growth Nexus," International Regional Science Review, , vol. 40(6), pages 638-678, November.
    3. Oleg V. Leshukov & Daria P. Platonova & Dmitry S. Semyonov, 2015. "Does Competition Matter? The Efficiency of Regional Higher Education Systems and Competition: The Case of Russia," HSE Working papers WP BRP 29/EDU/2015, National Research University Higher School of Economics.
    4. Barra, Cristian & Lagravinese, Raffaele & Zotti, Roberto, 2018. "Does econometric methodology matter to rank universities? An analysis of Italian higher education system," Socio-Economic Planning Sciences, Elsevier, vol. 62(C), pages 104-120.

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