Public-private higher education institution choice: quality or convenience?

Abstract

The creation of different types of higher education institutions, namely those that offer more professionally-oriented programmes, as well as the increasing number of private institutions has complexified student choices when applying to higher education. Apart from choosing a programme and an institution, students may have to choose the type of institution, and whether they will attend a public or a private institution. The purpose of this paper is twofold. First, it represents an attempt to complement the existing analysis of HEI choice by explicitly modelling two choices together: university versus polytechnic institute, and public versus private institutions. It aims at characterizing the student profile in each higher education sector (public or private), as well as provide some insights into the degree to which some types of students select themselves to private higher education institutions. Second, it aims at providing an updated look of the effect of the spatial distribution of HEI on the choice of prospective students. Depending on the spatial distribution and accessibility of higher education institutions, students may decide to attend higher education in their home region, or instead move to another region. Price differentiation may also have an influence on student decisions on whether to move or not. We pursue these objectives using the example of Portuguese higher education students. We explicitly model student choices of HEI type (university versus polytechnic institute and private versus public institution) based on socioeconomic background, spatial distribution of higher education institutions and student geographic mobility. We estimate a bivariate probit model using a comprehensive data set on all first time/first year students entering higher education in a specific academic year. Results suggest that higher income students prefer university over polytechnic institutes, but they favour private institutions. The value students put on institutional attributes like prestige, location, employability and leisure offer at the institution location play an effective role in the institution choice. Geographic accessibility to each type of institution favors the choice of that type of institution.