Can Online Learning Bend the Higher Education Cost Curve?

Abstract

We examine whether online learning technologies have led to lower prices in higher education. Using data from the Integrated Postsecondary Education Data System, we show that online education is concentrated in large for-profit chains and less-selective public institutions. We find that colleges with a higher share of online students charge lower tuition prices. We present evidence of declining real and relative prices for full-time undergraduate online education from 2006 to 2013. Although the pattern of results suggests some hope that online technology can “bend the cost curve” in higher education, the impact of online learning on education quality remains uncertain.