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The B.E. Journal of Theoretical Economics

Editor-in-Chief: Schipper, Burkhard

Ed. by Fong, Yuk-fai / Peeters, Ronald / Puzzello , Daniela / Rivas, Javier / Wenzelburger, Jan

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1935-1704
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University Competition and Transnational Education: The Choice of Branch Campus

Joanna Poyago-Theotoky
  • School of Economics, La Trobe University, Melbourne, Victoria 3086, Australia
  • GEOLAB, Ionian University, Corfu, Greece
  • Rimini Centre for Economic Research (RCEA), Rimini, Italy
  • Email:
/ Alessandro Tampieri
  • Corresponding author
  • Faculty of Law, Economics and Finance, University of Luxembourg, Avenue de la Faencerie 162a, L – 1511 Luxembourg
  • Email:
Published Online: 2016-05-27 | DOI: https://doi.org/10.1515/bejte-2015-0052

Abstract

We present a theoretical framework in which an elitist and a non-elitist university in a developed country compete by choosing admission standards and deciding whether or not to open a branch campus in a developing country. Students from a developing country attend university if either a branch campus is opened or, they can afford to move to the developed country. We find that the elitist university is more likely to open a branch campus. This result is reversed if the gain, in terms of prestige, to attend the home campus of the elitist university more than offsets a student’s mobility costs. A rise in the graduate wage increases the incentive for opening a branch campus, although this incentive is stronger for the elitist university.

Keywords: university competition; branch campus; admission standards; transnational education

JEL: I23; L13; F23

References

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About the article

Published Online: 2016-05-27

Published in Print: 2016-06-01


Citation Information: The B.E. Journal of Theoretical Economics, ISSN (Online) 1935-1704, ISSN (Print) 2194-6124, DOI: https://doi.org/10.1515/bejte-2015-0052.

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