Hierarchy and Market Competition in South Korea's Higher Education Sector

Abstract

This paper confirms that Korean higher education sector is highly hierarchical in which public and private institutions compete. In general, 4-year institutions (universities) specialize in higher quality spectrum, whereas 2-year institutions (colleges) specialize in lower quality spectrum with a substantial overlap of the two types institutions in the middle spectrum achievement. We also found that institutions located in Seoul or surrounding Kyunggi Province are able to attract better students and that there is a substantial premium for public universities even after controlling for net tuition and non-tuition subsidy.

Keywords: Higher Education, University, Hierarchy, Competition, South Korea

JEL Classification: I0, I2, H4