1. The future of higher education Anna Vignoles Institute for Education

2. Change Impact on demand Pricing The future shape of the sector

3. Impact on demand Previous fee increases have not impacted on enrolment ▫May have shortened the queue Economic value of a degree remains high ▫Increasing variation and problems for new graduates ▫Not all degrees are equally valuable

4. Impact on demand £9k fees may yet make a difference Fees may start to influence subject choice ▫High return subjects – quantitative, analytical, vocational Fees may start to influence institution choice ▫Quality Need for good advice becomes even more crucial ▫Transparency will be a challenge for the sector

5. Impact on demand What about the impact on poor students? No evidence that the socio-economic gap widened as a result of fees ▫Main barrier for disadvantaged young people is their prior achievement ▫No shortage of aspiration

6. Pricing Demand from students The impact of competition Costs of delivery

7. Demand from students Need to know the expected economic value of a degree in X at institution Y How much do students know? ▫Lifetime earnings ▫Initial salaries ▫Employment rates

8. Demand from students The market is limited by substantial subsidies ▫Debt written off for many students ▫Advertised price will matter less ▫Tendency to charge more as students less responsive to price

9. The impact of competition Reputation and pricing of competitors Who are an institution’s competitors? ▫Global ▫National ▫Local Gamesmanship and signalling effects

10. Costs of delivery Cost variation by subject ▫Some non-science courses are expensive and no longer subsidised Cross-subsidy What it means to be a university - minimum curriculum Dropping courses may make financial sense

11. The future shape of HE Opportunity for universities to innovate ▫Marketing strategies and promotions Price discrimination ▫Localism ▫Elitism Economies of scale - mergers Specialisation in subject areas