IDEAS home Printed from https://ideas.repec.org/p/ces/ceswps/_3373.html
   My bibliography  Save this paper

Competition between State Universities

Author

Listed:
  • Lisa Grazzini
  • Annalisa Luporini
  • Alessandro Petretto

Abstract

We analyse how state university competition to collect resources may affect both research and the quality of teaching. By considering a set-up where two state universities behave strategically, we model their interaction with potential students as a sequential noncooperative game. We show that different types of equilibrium may arise, depending on the mix of research and teaching supplied by each university, and the mix of low- and high-ability students attending each university. The most efficient equilibrium results in the creation of an élite institution attended only by high-ability students who enjoy a higher teaching quality but pay higher tuition fees.

Suggested Citation

  • Lisa Grazzini & Annalisa Luporini & Alessandro Petretto, 2011. "Competition between State Universities," CESifo Working Paper Series 3373, CESifo.
    • Handle: RePEc:ces:ceswps:_3373
    as

    Download full text from publisher

    File URL: https://www.cesifo.org/DocDL/cesifo1_wp3373.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Reinhilde Veugelers & Frederick Van der Ploeg, 2008. "Reforming European Universities: Scope for an Evidence-Based Process," CESifo Working Paper Series 2298, CESifo.
    2. Gautier, Axel & Wauthy, Xavier, 2007. "Teaching versus research: A multi-tasking approach to multi-department universities," European Economic Review, Elsevier, vol. 51(2), pages 273-295, February.
    3. De Fraja, Gianni & Iossa, Elisabetta, 2002. "Competition among Universities and the Emergence of the Elite Institution," Bulletin of Economic Research, Wiley Blackwell, vol. 54(3), pages 275-293, July.
    4. Rey, Elena Del, 2001. "Teaching versus Research: A Model of State University Competition," Journal of Urban Economics, Elsevier, vol. 49(2), pages 356-373, March.
    5. Philippe Aghion & Mathias Dewatripont & Caroline Hoxby & Andreu Mas-Colell & André Sapir, 2010. "The governance and performance of universities: evidence from Europe and the US [Distance to frontier, selection, and economic growth]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 25(61), pages 7-59.
    6. Rothschild, Michael & White, Lawrence J, 1995. "The Analytics of the Pricing of Higher Education and Other Services in Which the Customers Are Inputs," Journal of Political Economy, University of Chicago Press, vol. 103(3), pages 573-586, June.
    7. Dennis Epple & Richard Romano, 2008. "Educational Vouchers And Cream Skimming," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 49(4), pages 1395-1435, November.
    8. Tania Oliveira, 2006. "Tuition fees and admission standards: how do public and private universities really compete for students?," Discussion Papers in Economics 06/6, Division of Economics, School of Business, University of Leicester.
    9. Kemnitz, Alexander, 2003. "Funding, Competition and Quality in Higher Education," Discussion Papers 610, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    10. Hindriks, Jean & Myles, Gareth D., 2013. "Intermediate Public Economics," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262018691, April.
    11. De Fraja, Gianni & Valbonesi, Paola, 2012. "The design of the university system," Journal of Public Economics, Elsevier, vol. 96(3), pages 317-330.
    12. Geraint Johnes & Jill Johnes (ed.), 2004. "International Handbook on the Economics of Education," Books, Edward Elgar Publishing, number 2847.
    13. Epple, Dennis & Romano, Richard E, 1998. "Competition between Private and Public Schools, Vouchers, and Peer-Group Effects," American Economic Review, American Economic Association, vol. 88(1), pages 33-62, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marie-Laure Cabon-Dhersin & Jonas Didisse, 2017. "Inter-university competition and high tuition fees," Post-Print hal-02356872, HAL.
    2. Alexander Haupt & Tim Krieger & Thomas Lange, 2011. "Competition for the International Pool of Talent: Education Policy and Student Mobility," Working Papers CIE 35, Paderborn University, CIE Center for International Economics.
    3. Beath, John & Poyago-Theotoky, Joanna & Ulph, David, 2012. "University funding systems: Impact on research and teaching," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-24.
    4. 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.
    5. Berardino Cesi & Dimitri Paolini, 2014. "Peer Group and Distance: When Widening University Participation is Better," Manchester School, University of Manchester, vol. 82, pages 110-132, December.
    6. Aloys Prinz & Thomas Ehrmann, 2022. "Academia as a league system," Journal of Business Economics, Springer, vol. 92(7), pages 1065-1092, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Joan Rosselló, 2007. "Does a public university system avoid the stratification of public universities and the segregation of students?," DEA Working Papers 26, Universitat de les Illes Balears, Departament d'Economía Aplicada.
    2. De Fraja, Gianni & Valbonesi, Paola, 2012. "The design of the university system," Journal of Public Economics, Elsevier, vol. 96(3), pages 317-330.
    3. 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.
    4. Verbitskiy, Andrey (Вербицкий, Андрей) & Fridman, Alla (Фридман, Алла), 2014. "Competition between universities and government regulation [Конкуренция Между Вузами И Государственное Регулирование]," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 6, pages 137-160, December.
    5. Marie-Laure Cabon-Dhersin & Jonas Didisse, 2017. "Inter-university competition and high tuition fees," Post-Print hal-02356872, HAL.
    6. Robert J. Gary-Bobo & Alain Trannoy, 2005. "Efficient Tuition & Fees, Examinations, and Subsidies," IDEP Working Papers 0501, Institut d'economie publique (IDEP), Marseille, France, revised 01 Mar 2005.
    7. Hidalgo-Hidalgo Marisa & Valera Guadalupe, 2016. "University Merging Process: A Guideline Proposal for Excellence-Enhancing," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(3), pages 1359-1386, September.
    8. Berardino Cesi & Dimitri Paolini, 2014. "Peer Group and Distance: When Widening University Participation is Better," Manchester School, University of Manchester, vol. 82, pages 110-132, December.
    9. Masahito Ambashi, 2021. "Theoretical Analysis of University Research and Teaching in the Presence of External Research Funding," KIER Working Papers 1069, Kyoto University, Institute of Economic Research.
    10. Alexander Kemnitz, 2007. "University Funding Reform, Competition, and Teaching Quality," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 163(2), pages 356-378, June.
    11. Su, Xuejuan & Kaganovich, Michael, 2012. "College Expansion and Curriculum Choice," Working Papers 2012-25, University of Alberta, Department of Economics, revised 01 Apr 2015.
    12. Michael Kaganovich & Xuejuan Su, 2019. "College curriculum, diverging selectivity, and enrollment expansion," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 67(4), pages 1019-1050, June.
    13. Cantner, Uwe & Grashof, Nils & Grebel, Thomas & Zhang, Xijie, 2023. "When Excellence is not Excellent: The Impact of the Excellence Initiative on the Relative Productivity of German Universities," MPRA Paper 118139, University Library of Munich, Germany.
    14. Manna, Ester, 2013. "Mixed Duopoly with Motivated Teachers," MPRA Paper 52041, University Library of Munich, Germany.
    15. Elias Carroni & Berardino Cesi & Dimitri Paolini, 2016. "Local University Supply and Distance: A Welfare Analysis with Centralized and Decentralized Tuition Fees," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 2(2), pages 239-252, July.
    16. Cremer, Helmuth & Maldonado, Dario, 2013. "Mixed oligopoly in education," IDEI Working Papers 766, Institut d'Économie Industrielle (IDEI), Toulouse.
    17. De Fraja, Gianni & Landeras, Pedro, 2006. "Could do better: The effectiveness of incentives and competition in schools," Journal of Public Economics, Elsevier, vol. 90(1-2), pages 189-213, January.
    18. Polishchuk, L., 2010. "Collective Reputation in Higher Education: An Equilibrium Model," Journal of the New Economic Association, New Economic Association, issue 7, pages 46-69.
    19. Dennis Epple & Richard Romano & Sinan Sarpça & Holger Sieg & Melanie Zaber, 2019. "Market power and price discrimination in the US market for higher education," RAND Journal of Economics, RAND Corporation, vol. 50(1), pages 201-225, March.
    20. Epple, Dennis & Figlio, David & Romano, Richard, 2004. "Competition between private and public schools: testing stratification and pricing predictions," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1215-1245, July.

    More about this item

    Keywords

    university competition; research; tuition fees;
    All these keywords.

    JEL classification:

    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • 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:ces:ceswps:_3373. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Klaus Wohlrabe (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.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.