IDEAS home Printed from https://ideas.repec.org/p/unm/umagsb/2024005.html
   My bibliography  Save this paper

Competition in Higher Education: Sorting, Ranking and Fees

Author

Listed:
  • Liu, Kaiqi

    (RS: GSBE UM-BIC, Microeconomics & Public Economics)

  • Rusch, Hannes

    (RS: GSBE UM-BIC, Microeconomics & Public Economics, RS: GSBE other - not theme-related research)

  • Seel, Christian

    (RS: GSBE other - not theme-related research, Microeconomics & Public Economics)

  • Terstiege, Stefan

    (RS: GSBE UM-BIC, Microeconomics & Public Economics)

Abstract

We model student enrollment in markets for higher education where public universities, private non-profit universities, and private for-profit universities compete. Universities differ with respect to their capacity, graduation probability, and profit objective; students differ in ability. The value of a diploma at each university depends on its endogenous ranking based on average student ability. In every equilibrium, the private for-profit university attracts the least able students. Under additional conditions, the private non-profit university attracts the top students. Paradoxically, a higher capacity at the public university might decrease its equilibrium market share as it incentivizes the for-profit university to compete more aggressively. The for-profit university benefits from an increased enrollment in higher education.

Suggested Citation

  • Liu, Kaiqi & Rusch, Hannes & Seel, Christian & Terstiege, Stefan, 2024. "Competition in Higher Education: Sorting, Ranking and Fees," Research Memorandum 005, Maastricht University, Graduate School of Business and Economics (GSBE).
    • Handle: RePEc:unm:umagsb:2024005
    DOI: 10.26481/umagsb.2024005
    as

    Download full text from publisher

    File URL: https://cris.maastrichtuniversity.nl/ws/files/192195891/RM24005.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.26481/umagsb.2024005?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:unm:umagsb:2024005. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Andrea Willems or Leonne Portz (email available below). General contact details of provider: https://edirc.repec.org/data/meteonl.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.