This paper compares the organisation of the university sector under unregulated private provision with the structure which would be chosen by a welfare maximising government. It studies a general equilibrium model where students attend university to earn higher incomes in the labour market, and universities teach them and carry out research. Each university chooses its tuition fee to maximise the amount of resources it can devote to research. Research bestows an externality on society. Government intervention needs to balance labour market efficiency considerations -- which would tend to equalise the number of students attending each university -- with considerations of efficiency on the production side, which suggest that the most productive universities should teach more students and carry out more research. We find that government concentrates research more that the private market would, but less than it would like to do if it had perfect information about the productivity of universities. It also allows fewer universities than would operate in a private system.

DE FRAJA, G., Valbonesi, P. (2012). The design of the university system. JOURNAL OF PUBLIC ECONOMICS, 96(3-4), 317-330 [10.1016/j.jpubeco.2011.10.005].

The design of the university system

DE FRAJA, GIOVANNI;
2012-01-01

Abstract

This paper compares the organisation of the university sector under unregulated private provision with the structure which would be chosen by a welfare maximising government. It studies a general equilibrium model where students attend university to earn higher incomes in the labour market, and universities teach them and carry out research. Each university chooses its tuition fee to maximise the amount of resources it can devote to research. Research bestows an externality on society. Government intervention needs to balance labour market efficiency considerations -- which would tend to equalise the number of students attending each university -- with considerations of efficiency on the production side, which suggest that the most productive universities should teach more students and carry out more research. We find that government concentrates research more that the private market would, but less than it would like to do if it had perfect information about the productivity of universities. It also allows fewer universities than would operate in a private system.
2012
Pubblicato
Rilevanza internazionale
Articolo
Esperti anonimi
Settore SECS-P/03 - SCIENZA DELLE FINANZE
English
higher education
DE FRAJA, G., Valbonesi, P. (2012). The design of the university system. JOURNAL OF PUBLIC ECONOMICS, 96(3-4), 317-330 [10.1016/j.jpubeco.2011.10.005].
DE FRAJA, G; Valbonesi, P
Articolo su rivista
File in questo prodotto:
File Dimensione Formato  
DeFraja Valbonesi.pdf

solo utenti autorizzati

Licenza: Non specificato
Dimensione 346.85 kB
Formato Adobe PDF
346.85 kB Adobe PDF   Visualizza/Apri   Richiedi una copia

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/2108/123496
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 18
  • ???jsp.display-item.citation.isi??? 16
social impact