A Study of Demand for Higher Education at Private Institutions in the US: A Dynamic and General Specification

Abstract

Time-series annual data were used to study the effects of changes in tuition and other factors on enrolment at private colleges and universities in the US. A general functional from with a dynamic specification is used for the functional relationship. Empirical results show that the log-linear and linear functional forms and the static model, which have been used in previous studies, can be rejected statistically at the 5% level. Results also show that actual enrolment adjusts to the desired enrolment very slowly, and that tuition and other related costs of attending colleges and universities have considerable effects on the enrolment at private colleges and universities in the US.