Some new evidence of the character of competition among higher education institutions

This study employs a simple enrollment demand model to investigate the regional market environment of a private, church-related, comprehensive institution of higher education offering undergraduate, graduate and professional education. The focus is on price and cross-price elasticities of demand as measures of the competitive threat posed by prominent public and private educational alternatives within the region. We find a significant competitive threat coming from the private sector within the region. This competition raises the net price elasticity of demand for education at this institution to well above unity. We conclude that tuition price subsidies play a critical role in managing enrollment demand at this institution. [JEL J3, J24, J41] (C) 1999 Elsevier Science Ltd. All rights reserved.