Study : Online education can “bend the cost curve”

Inside Higher Ed reports:

Online education can “bend the cost curve” of an undergraduate degree, according to a working paper from the National Bureau of Economic Research, but whether the lower tuition is caused by a boost in productivity -- as opposed to more competition -- is still undetermined.

The paper (abstract available here), authored by business and economics professors at Harvard University and the University of California at Berkeley, explores the fluctuations in the cost of an undergraduate degree -- and if online learning impacted that change -- since the federal government removed a rule that restricted most institutions from offering more than half of their courses online. Known as the 50-percent rule, the regulation was removed in February 2006.

The researchers, David J. Deming, Claudia Goldin, Lawrence F. Katz, and Noam Yuchtman, used data from the federal government’s Integrated Postsecondary Education Data System, or IPEDS, for their analysis. Since data on the number of students taking courses online only goes back to fall 2012, the researchers filled the gap between 2006 and 2012 with enrollment and tuition cost data from institutions where more than 50 percent of enrolled students took all their courses online. They then compared those numbers to institutions where most students took courses in the classroom.

The supply of higher education.