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The good MOOC and the universities

Author

Listed:
  • Emilie Dargaud

    (Univ Lyon, Université Lumière Lyon 2, GATE UMR 5824, F-69130 Ecully, France)

  • Frédéric Jouneau-Sion

    (Univ Lyon, Université Lumière Lyon 2, GATE UMR 5824, F-69130 Ecully, France)

Abstract
We propose a model to analyze competition between an on-line course and a traditional brick-and-mortar supply for higher education. The brick and mortar supplier is physically located and students pay a transportation cost to attend the traditional course. On the contrary, the on-line course is free, without transportation cost but students incurred a fixed homogeneous disutility when choosing this type of course. We derive the optimal fee policy of a single university as a function of its location and the fixed cost associated with the on-line course. We also study the impact of distant learning on the competition between two brick and mortar universities. One university is assumed to enjoy a central position, whereas the other one is located at the extreme left of the town. We discuss equilibria and market sharing in non-regulated (i.e pure fee competition) and regulated (i.e. quantity competition) settings. Finally, public issues are addressed. In particular, the socially optimal provision of MOOC and the supply of MOOC by universities are carefully discussed.

Suggested Citation

  • Emilie Dargaud & Frédéric Jouneau-Sion, 2019. "The good MOOC and the universities," Working Papers 1905, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
  • Handle: RePEc:gat:wpaper:1905
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    File URL: ftp://ftp.gate.cnrs.fr/RePEc/2019/1905.pdf
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    References listed on IDEAS

    as
    1. Lutz, Wolfgang & Butz, William P. & KC, Samir (ed.), 2014. "World Population and Human Capital in the Twenty-First Century," OUP Catalogue, Oxford University Press, number 9780198703167.
    2. Paul Belleflamme & Julien Jacqmin, 2016. "An Economic Appraisal of MOOC Platforms: Business Models and Impacts on Higher Education," CESifo Economic Studies, CESifo Group, vol. 62(1), pages 148-169.
    3. Jérôme FONCEL & Marianne GUYOT & Frédéric JOUNEAU - SION, 2011. "The shop around the corner in the Internet age," Discussion Papers (REL - Recherches Economiques de Louvain) 2011025, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
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    7. Caroline M. Hoxby, 2014. "The Economics of Online Postsecondary Education: MOOCs, Nonselective Education, and Highly Selective Education," American Economic Review, American Economic Association, vol. 104(5), pages 528-533, May.
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    10. Jérôme Foncel & Marianne Guyot & Frédéric Jouneau-Sion, 2011. "The shop around the corner in the Internet age," Recherches économiques de Louvain, De Boeck Université, vol. 77(2), pages 47-85.
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    12. Paul BELLEFLAMME & Julien JACQMIN, 2014. "Les plateformes MOOCs. Menaces et opportunités pour l’enseignement universitaire," Regards économiques 110, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
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    More about this item

    Keywords

    On-line learning; spatial competition;

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L17 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Open Source Products and Markets
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R39 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other

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