Higher Education Expansion and Credit Risk: Evidence from China Universities Panel Data

Chih-Hung Chen and Chiu-Ming Hsiao

International Journal of Public Administration, 2021, vol. 44, issue 6, 477-488

Abstract: This study aimed to examine the relationship between two constructs: scale and credit risk of the higher educational institutions. A regression analysis was conducted for panel data from 2015 to 2019 with fixed/random effects. The outcomes showed that scale had a significantly negative relationship with both credit risk measures, indicating that the rapid expansion of a university will decrease its ability to repay the debt and efficiently operate. In other words, credit risk greatly arises while a higher education institution (HEI) is expanding rapidly. The findings illustrated that HEIs in China were actually suffering diseconomies of scale and expanding too fast to increase the quality and efficiency.

Date: 2021
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DOI: 10.1080/01900692.2020.1729183

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