catallaxy files

catallaxy in technical exile

Why are university applications dropping?

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Victoria’s newspapers think that higher student charges are putting students off.

Victorians are turning their backs on higher education amid rising costs, said the Herald Sun. Demand for government-funded university places has fallen for the second year in a row as the increasing cost of higher education bites deeper, agreed The Age.

As I have argued, some decline in interest is not necessarily a bad thing, if it is just people for whom university education is a borderline proposition. If this is what’s happening, it is price signals doing what price signals should – prompting people to allocate resources where they will get the greatest benefit. There is no data available yet on this for 2006, but the 2005 data, which can be extracted from the AVCC’s unmet demand surveys, is rather confusing.

Their national data suggest that while university applications as a percentage of school leavers in the 90+ ENTER range were stable between 2004 and 2005, acceptances as a percentage of school leavers dropped from 83.3% to 79.2%. In other ENTER ranges, applications were fairly similar: 80- 90, -2.4%, 70-80, +1.8%, 60-70, +2.1%. Acceptances (the better measure, the people actually prepared to pay the money), however, were up. This is the reverse of what my theory would expect, that those for whom returns are most doubtful would be most affected by price.

My theory could, of course, be wrong. But a couple of caveats before I revise my theories. The biggest impact on this was a huge drop in Victorian acceptances in the 90+ range, from 91.8% to 74.7%. This seems too large to be credible, and indeed something must be wrong with the Victorian data. Though it is supposed to be only people who did Year 12 the year before and only home state applications, the number of applicants exceeds the number of Year 12 students. It’s possible overall for applicants to exceed students in Year 12, because people apply from interstate, but not if the data is restricted to home state. Perhaps we are comparing home-state acceptances with all applications, home and inter-state.

The other trend of interest is in commencing student enrolment data. Over the period 2000-2004, the number of domestic students aged 21 or less starting a course increased by 2,532. However the number of 16 and 17 year olds declined by 2,342 and 18 year olds declined by 222. All the growth was in the 19-21 year old group. This is probably partly people trying to qualify as ‘independent’ of their parents for Youth Allowance purposes, and perhaps increasing use of ‘gap’ years.

Gap years are most likely to be favoured by children of well-off families than can afford the year off, and these are also the people most likely to get high ENTER scores. Perhaps what we are seeing here is money talking, but not the way the papers assume.

Written by Admin

January 11, 2006 at 12:03 pm

Posted in Uncategorized

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