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Understanding the Impact of Tuition Fees in Foreign Education: the Case of the UK

Michel Beine (), Marco Delogu () and Lionel Ragot ()
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Michel Beine: CREA, Université du Luxembourg

CREA Discussion Paper Series from Center for Research in Economic Analysis, University of Luxembourg

Abstract: This paper studies the determinants of international students’ mobility at the university- level, focusing specifically on the role of tuition fees. We first develop an original Random Utility Maximization model of location choice for international students in the presence of capacity constraints of the hosting institutions. The last layer of the model gives rise to a gravity equation. This equation is estimated using new data on student migration flows at the university level for the U.K. We control for the endogeneity of tuition fees by taking benefit of the institutional constraints in terms of tuition caps applied in the UK to European students at the bachelor level. The estimations support a negative impact of tuition fees and stress the need to account for the endogenous nature of the fees in the empirical identification of their impact. The estimations also support an important role of additional destination-specific variables such as host capacity, the expected return of education and the cost of living in the vicinity of the university.

Keywords: Foreign students; Tuition fees; Location choice; University Quality. (search for similar items in EconPapers)
JEL-codes: F22 H52 I23 O15 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-edu, nep-eur, nep-mig and nep-upt
Date: 2017
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https://wwwfr.uni.lu/content/download/102472/12267 ... %20of%20the%20UK.pdf (application/pdf)

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Working Paper: Understanding the Impact of Tuition Fees in Foreign Education: the Case of the UK (2017) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:luc:wpaper:17-15

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