[lbo-talk] MH & DG on university

Wojtek S wsoko52 at gmail.com
Mon Feb 27 10:53:21 PST 2012


Shag: "you seem to be illustrating what I mean. "

[WS:] Yes, I just added a few new elements - increased enrollment and competition. The effect of increased enrollment or "output" is different for unis than for other industries. In other industries, the marginal cost decreases as the output increases, in unis - it increases due to the Baumol effect. As far a competition is concerned, it adds transaction cost that is passed on buyers.

But I am in agreement with what you said.

Wojtek



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