The Costs of Online Education

• In Event: Higher Education Costs, Finances, and Opportunity

Abstract

Online education is an important feature of the higher education landscape, especially following Covid19. I investigate the cost-saving potential of online education across a large population of higher education institutions over time. Using a panel regression framework, I test whether increases in the share of students enrolled either exclusively or partially online are associated with reductions in instructional or academic support costs. I find that increases in exclusively online enrollment is associated with reductions in instructional costs, while no significant cost reductions are detected in terms partially online enrollment and for academic support costs. Findings are heterogenous across institutional type, with the strongest negative relationship between online enrollment and costs exhibited in master’s institutions.

Author

• Ji Yeon Bae, University of Pennsylvania