Choosing the future: economic preferences for higher education using discrete choice experiment method

Mikolaj Czajkowski, Tomasz Gajderowicz, Marek Giergiczny, Gabriela Grotkowska (ggrotkowska@wne.uw.edu.pl) and Urszula Sztandar-Sztanderska (sztanderska@wne.uw.edu.pl)
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Urszula Sztandar-Sztanderska: Faculty of Economic Sciences, University of Warsaw

No 2017-16, Working Papers from Faculty of Economic Sciences, University of Warsaw

Abstract: This study illustrates how respondents’ stated choices (the discrete choice experiment method) combined with the random utility framework can be used to model preferences for higher education. The flexibility offered by stated preference data circumvents limitations of other approaches, and allows quantifying young people’ preferences for selected attributes of higher education programs that are typically highly correlated in revealed preference data. The empirical study presented here is based on a survey of 20,000 Polish respondents aged 18-30, who stated their preferences for higher education programs in carefully prepared hypothetical choice situations. The attributes we considered include tuition fee, expected salary after graduation, quality of institution, interest in the field of study, distance from home, and mode of study. Using random parameters and latent class mixed multinomial logit models, we can formally describe young peoples’ preferences, and identify the financial trade-offs they are willing to make, that is, estimate their willingness to pay for specific attribute levels in terms of increased tuition fees or expected salary after graduation. Accounting for respondents’ observed and unobserved preference heterogeneity, we address a few research questions related to, for example, distinct preferences of students whose neither parent attained tertiary education, students from lower socio-economic groups, or students of a particular gender. Overall, we demonstrate how stated preference methods can be a useful tool for exploring economic preferences, better understanding the determinants of choices, forecasting, and designing the services offered by higher education institutions in an optimal way.

Keywords: higher education institution choice; random utility model; stated preferences; discrete choice experiment (search for similar items in EconPapers)
JEL-codes: D12 H52 I23 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2017
New Economics Papers: this item is included in nep-dcm, nep-edu, nep-eur and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://www.wne.uw.edu.pl/index.php/download_file/3700/ First version, 2017 (application/pdf)

Related works:
Journal Article: Choosing the Future: Economic Preferences for Higher Education Using Discrete Choice Experiment Method (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:war:wpaper:2017-16

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