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Return migration of foreign students and non-resident tuition fees

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  • Thomas Lange

Abstract

This paper challenges the notion that optimal non-resident tuition fees should necessarily be raised if the return rate of foreign students after graduation increases. The analysis of a host country’s optimal pricing behavior therefore incorporates a specific student migration model. Students usually are aware of the fact that they might return to their home countries after being educated abroad, even if they initially intended to stay on in the host country. With rational expectations, a change in students’ perceptions of the return probability after graduation can affect their first-round decisions whether to study abroad. The optimal adjustment of non-resident tuition fees in the host country has to take this behavioral response into account. Under certain conditions, the behavioral effect is dominant, and a decline in stay rates of students actually requires tuition fee cuts. Copyright Springer-Verlag 2013

Suggested Citation

  • Thomas Lange, 2013. "Return migration of foreign students and non-resident tuition fees," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(2), pages 703-718, April.
    • Handle: RePEc:spr:jopoec:v:26:y:2013:i:2:p:703-718
    DOI: 10.1007/s00148-012-0436-6
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    1. Gabrielle Demange & Robert Fenge & Silke Uebelmesser, 2020. "Competition in the quality of higher education: the impact of student mobility," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(5), pages 1224-1263, October.
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    16. Thomas Lange, 2009. "Public Funding of Higher Education when Students and Skilled Workers are Mobile," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 65(2), pages 178-199, June.
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    Cited by:

    1. Dang Hai-Anh H. & Huang Yang & Selod Harris, 2020. "Children Left Behind in China: The Role of School Fees," IZA Journal of Development and Migration, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 11(1), pages 1-29, January.
    2. Lergetporer, Philipp & Woessmann, Ludger, 2019. "The Political Economy of Higher Education Finance: How Information and Design Affect Public Preferences for Tuition," Rationality and Competition Discussion Paper Series 145, CRC TRR 190 Rationality and Competition.
    3. Gabrielle Demange & Robert Fenge & Silke Uebelmesser, 2020. "Competition in the quality of higher education: the impact of student mobility," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(5), pages 1224-1263, October.
    4. Naito, Takumi & Zhao, Laixun, 2020. "Capital accumulation through studying abroad and return migration," Economic Modelling, Elsevier, vol. 87(C), pages 185-196.
    5. Haupt, Alexander & Krieger, Tim & Lange, Thomas, 2013. "Education policy, student migration, and brain gain," Discussion Paper Series 2013-05, University of Freiburg, Wilfried Guth Endowed Chair for Constitutional Political Economy and Competition Policy.
    6. Bernard Franck & Robert F. Owen, 2015. "Human Capital Formation, International Labor Mobility and the Optimal Design of Educational Grants," Working Papers hal-01158239, HAL.
    7. Alexander Haupt & Tim Krieger & Thomas Lange, 2016. "Competition for the international pool of talent," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(4), pages 1113-1154, October.
    8. Jan Saarela & Kirk Scott, 2017. "Mother Tongue, Host Country Earnings, and Return Migration: Evidence from Cross-National Administrative Records," International Migration Review, Wiley Blackwell, vol. 51(2), pages 542-564, June.
    9. Меликян А. В., 2018. "Внутренние Факторы Результативности Экспорта Образования В Российских Вузах," Вопросы образования // Educational Studies Moscow, National Research University Higher School of Economics, issue 3, pages 146-179.

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    More about this item

    Keywords

    Tuition fees; Overseas students; Return migration; Brain drain; Rational expectations; F22; I29; D84;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • I29 - Health, Education, and Welfare - - Education - - - Other
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations

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