Course Goals/Objectives

  The goals of the course is to enable the student to be a competent partner in the process of setting up and managing economic aspects of distance education, both on institutional level as well as on course level (i.e. with regard to media choice).

At the end of the course students should have achieved the following objectives. The student

1. reviews the expansion of education and the soaring costs of educational provision.
2. understands the conceptual framework of 'Human Capital Theory', a core theory of economics of education.
3. identifies the cost drivers in distance education systems and is able to measure them.
4. understands the role of overheads and the problem of cost attribution.
5. is able to treat capital costs including the annualization of costs.
6. handles the basic cost model and is able to analyze scale economies.
7. analyzes and compares the costs of media and handles a cost model for rapid cost appraisal of a selected media configuration.
8. applies the costing methodology to netbased learning and identifies the cost-drivers specific to netbased learning
9. analyzes the costs of online student support
10. discusses the impact of netbased learning on the cost-structure of distance education

REQUIRED TEXTBOOKS

Bates, A. W. (2005). Technology, e-learning and distance education. London: Routledge.
Rumble, G. (Ed.). (2004). Papers and debates on the costs and economics of distance education and online learning (Vol. 7). Oldenburg: Bibliotheks- und Informationssystem der Carl von Ossietzky Universität Oldenburg.
Rumble, G. (1997). The Costs and Economics of Open and Distance Learning. London: Kogan Page.
NOTE:
Rumble (1997) may be out of print. The new edition is not yet available. The most important chapters will be made available online.
Rumble, G. (Ed.). (2004) will be available at Missouri Bookshop

In general, journal articles and papers referenced in this Syllabus will be supplied online.

COURSE REQUIREMENTS

This course is only offered in the online mode. Students must be prepared to:

• ensure technical to access Webtycho
• ensure the availability of Excel
• invest an average12.5 hour workload in each of the twelve weeks of the course.

The 150 hours workload during the course consists of:

• 50 hours of reading,
• 50 hours of active, visible participation in the discussion groups,
• 50 hours for assignments.

GRADING

To the final grade of this course both, assignments, and participation to the conferences will contribute:

• Online participation contributes 25 % to the final grade.
• There is one ungraded group tasks in module one and five respectively. It is not graded though contributing to the grade indirectly since it affects the participation rating.
• The first assignment must be submitted by the end of Module 2. It contributes 25 % to the final grade.
• The second assignment must be submitted by the end of Module 3. It contributes 25 % to the final grade.
• The third assignment consists of a graded group assignment and must be submitted by the end of Module 5 . It contributes 25 % to the final grade.

COURSE OUTLINE
 

Module 1 Introduction
The Expansion of Education and the Emergence of the Economics of Education

During the first week a number of issues will have to be addressed: Students will be introduce each other and will be given an outline of the course setup.

However, we  proceed soon to the course content. What is the rationale behind the unprecedented expansion of education? Education can be seen as an investment with very real returns to the individual as well as to society as a whole. Individual demand rises and there seems little reason to discourage it. But trying to satisfy a mass demand for education, giving the scarcity of resources, leads to the question of the most cost-effective provision of education. Distance education seems to fit this bill. Using rational production techniques, including division of labor and the application of media and technologies, distance education may be seen as being capable of emulating the success of industrialized manufacture of high quality consumer goods.

This relation between the core theory of economics of education which suggests to view education as an investment ('Human Capital Theory'), the historically unprecedented worldwide postwar expansion of education, and the emergence of distance education sets the scene for the questions of this course.

In the second week students will be asked to do some group work. Students will collaborate to explore the expansion of education using the GED database. While this group work is not graded, participation is strongly recommended since it will allow students to become acquainted with the use of Excel spreadsheets required in the first assignment.

Management issues and  objectives:

• Students and faculty introduce themselves to each other
• Students are introduced to the Economics of Distance Education course
• Students review the expansion of education using the GED database
• Students are introduced to the main tenets of the economics of education (e.g. Human Capital Theory)
• Students identify the expectations connected with distance education in the context of increased demand for education and soaring costs.

Required reading:

Perraton, H. (2000). Introduction: golden goose and ugly duckling, Open and distance learning in the developing world (pp. 4-9). London: Routledge.
Schultz, T. W. (1961). Investment in human capital. American Economic Review, 51, 1-17.
Pritchett, L. (1999, December). Where has all the education gone? World Bank. Retrieved November, 5, 2003, from the World Wide Web: http://www.worldbank.org/research/growth/pdfiles/Where_r4.pdf

Additional reading:
Psacharopoulos, G. (1995). The Profitability of Investment in Education: Concepts and Methods: World Bank.
Peters, O. (1994). Distance education and industrial production: a comparative interpretation in outline. In D. Keegan (Ed.), Otto Peters on distance education: the industrialisation of teaching and learning (pp. 107-127). London: Routledge.

Group task
At the end of module 1 students are to complete a group task. The task will not be graded and affects the final grade only through its contribution to the 25% of participation rating (cf. Grading above).

Module 2
The Techniques of Cost Analysis

Special emphasis is given to the issues like capital costs, overheads and cost attribution of joint products.

Objectives:

1. Students analyze distance education as a system and identify the main subsystems.
2. Students classify resources (including human resources, premises, equipment and stocks)
3. Students classify costs into the main cost categories (fixed and variable costs, capital and recurrent costs, opportunity costs).
4. Students handle the basic cost model to explore the effects of the different cost categories on average cost per student.
5. Students describe and apply different options for treating capital costs

Required readings:

Hülsmann, T. (2004) Costing open and distance learning (WBT)
Work through the following sections:
- Drawing up a budget
- Elements of cost-analysis
Rumble, G. (1997). The Costs and Economics of Open and Distance Learning. London: Kogan Page.
Read through the following sections:
- Overheads (pp.51-64)
- Attribution of costs (pp. 65-73)

Additional reading:
Rumble, G. (1997). The Costs and Economics of Open and Distance Learning. London: Kogan Page.
The following sections can be seen as complementary to Hülsmann (2004):
- Budgets (pp. 7-12)
- The classification of resources (pp. 13-20)
- A basic framework for analysing revenue costs (pp. 21-31)
- Volume and its relationship with fixed and variable costs (32-41)
- The treatment of capital costs (42-50)

Assignment
At the end of module 2 students are to submit an assignment that contributes 25% to the final grade.

 

Module 3
with Professor Dr. Greville Rumble as visiting expert
The Cost-effectiveness of Distance Education

This module applies cost analysis to distance education institutions. Using 'cost per student' and 'cost per graduate' as an proxy indicator for cost-effectiveness we will examine the method of analyzing institutional cost-effectiveness. We review case study evidence for the claim of distance education being a cost-effective means of educational provision.

Management guidelines to monitor the cost-effectiveness of distance education are suggested.

Objectives

1. Students summarize the methodology of cost-effectiveness analysis of distance education systems.
   Students identify the most important indicators of measuring institutional effectiveness (cost per student and cost per graduate).
   Students identify the different steps in cost analysis of distance education institutions
2. Students summarize the evidence for the cost-effectiveness of distance education
   Students examine the evidence of the cost-effectiveness of open universities
   Students summarize the evidence for the cost-effectiveness of distance teaching for 'school equivalency' (the World Bank/UNESCO case studies).
3. Students identify different institutional forms of distance education. In particular:
   Students distinguish between dedicated mode, dual- and mixed-mode, networks and consortia.
   Students examine the implications of these modes on the cost structures of the respective institutions.
4. Students identify planning guidelines for ascertaining the cost-effectiveness of distance teaching institutions.

Required readings:

Hülsmann, T. (2004) Costing open and distance learning (WBT)
Work through the following sections:
- Cost-effectiveness of ODL

Laidlaw, B., & Layard, R. (1974). Traditional versus Open University teaching method: A cost comparison. Higher Education, 3, 439-468.

Rumble, G. (Ed.) (2004). Papers and debates on the costs and economics of distance education and online learning (Vol. 7). Oldenburg: Bibliotheks- und Informationssystem der Carl von Ossietzky Universität Oldenburg.
Read the following sections:
- Rumble, G. The competitive vulnerability of distance teaching Universities (1992). (pp. 67-88)
- White, V. Responses to Greville Rumble's article 'The competitive vulnerability of distance teaching universities'(1992). (pp. 89-92).
- Mugridge, I. Responses to Greville Rumble's article 'The competitive vulnerability of distance teaching universities' (1992). (pp. 93-96).
- Keegan, D. The competitive advantages of distance teaching universities (1994). (pp. 107-117).
- Rumble, G. The competitive vulnerability of distance teaching universities: a reply (1994). (pp. 103-106).
- Rumble, G. Competitive vulnerability: an addentum to the debate (1998). (pp. 107-117).

Additional reading:
Levin, H. M. (1995). Cost-effectiveness Analysis. In M. Carnoy (Ed.), Internation al encyclopedia of economics of education, (pp. 381-386).Oxford: Pergamon.

Assignment
At the end of module 3 students are to submit an assignment that contributes 25% to the final grade.
 
 

Module 4
Costing Educational Media and Technologies: Traditional Media in Distance Education

The cost-effectiveness of distance education depends to a large extent on the appropriate media choice. For the medium to be cost-effective it needs to be cost-efficient and effective. Hence to which extent a medium contributes to effective teaching and learning is a question which impacts on the issue of cost-effectiveness. Hence Module 4 re-visits the media equivalence hypothesis (MEH) and the question to which extent course planners can be relaxed about the choice of the medium (because it makes no difference or does not influence teaching and learning at all), or to which extent it is important to make use of the various capabilities of a medium in a given context.
Second, the module addresses the issue of costing media. After some methodological considerations on how to cost educational media and technologies and the introduction of 'cost per student  learning hour' as a measure to facilitate cost comparison, classify media are classified in two major categories. In the first category 'resource media' are placed, which are unidirectional and can be replicated  as objects, e.g. books, cassettes, CD-ROMs. They are more likely to generate economies of scale. Communication media on the other hand (the second category) establish and sustain communication between student and teacher/tutor, and are less prone to generate scale economies.
In this module we consider especially the costs of resource media: print, ratio/ audio cassettes, television/video cassettes.

Objectives

1. Students discuss the various versions of the media equivalence hypothesis.
2. Students examine Bates' ACTIONS model of evaluating educational media and technologies.
3. Students understand the problems of comparing educational technologies/ media.
   • Students determine 'cost per learning time' as an indicator to compare costs of media.
   • Students understand the cost-structure for communication media.
   • Students analyze the costs and cost-structure of resource media

Required readings:

Bates, A. W. (1995). Technology, open learning and distance education. (pp. 33-60) London: Routledge.

Clark, R. E. (1983). Reconsidering Research on Learning from Media. Review of Educational Research, 53(4), 445-459.

Hülsmann, T. (2004) Costing open and distance learning (WBT)
Work through the following sections:
Costing educational media: (i) Concepts; (ii) Costing traditional media

Kozma, R. B. (1991). Learning with media. Review of Educational Research, 61(2), 179-211.

Additional readings:
Hülsmann, T. (2000). The Costs of open learning: a handbook. Oldenburg: Bibliotheks- und Informationssystem der Carl von Ossietzky Universität Oldenburg. (Chapter 1, Chapter 2, Case study 1, Case study 3, Case study 9)

Perraton, H. (1983). A Theory for Distance Education. In D. Sewart, Keegan, D., Holmberg, B. (Ed.), Distance Education: International Perspectives. New York, London, Canberra: St. Martin's Press; Croom Helm.

Assignment:
At the end of module 5 students are to submit an assignment that contributes 25 % to the final grade.

Module 4 (cont.)
Costing Educational Media and Technologies: E-Learning

The second part of the module addresses e-learning. E-learning (e-education, distributed e-learning) integrates the different types of media often by unified Learning Management Systems (LMS). But it makes a big difference in terms of cost structure if digital media emphasize the information processing aspect of ICT (type-i, e.g. CBTs) or the communication aspect (type-c, e.g. asynchronous seminars). The communication intensive variants of distance education tend to loose DE's potential for scale economies which has been the major rationale for its claim to be a more cost-effective option of educational provision.
The module asks finally if and to which extent the lost efficiencies (due to a reduced potential of scale economies) can be recovered. It sees two main options: (i) increased use of learning objects; (ii) intensified cooperation and the forming of alliances.

Objectives

1. Students discuss the impact of ICT on distance education
2. Students distinguish various types of ICT-based distance educatiobn (e-learning)
3. Students apply the costing methodology to analyze
   • synchronous forms of e-learning (e.g. 'extended classroom model')
   • asynchronous forms of e-learning (e.g. 'virtual seminar model')
4. Students analyze ways to recover lost efficiencies by
   • making increased use of learning objects
   • intensifying collaboration and cooperation

Required readings:

Bates, A. W. (2005). Technology, e-learning and distance education. London New York: Routledge.
Read the following sections:
- Bates, A. W., Picard, J. (2005). Audio-, video- and Web-conferencing: Access and treaching issues. In A. W. Bates (Ed.), Technology, e-learning and distance education. (pp. 175-192). London New York:: Routledge.
- Bates, A. W., Picard, J. (2005). Audio-, video- and Web-conferencing: Costs and organizational issues. In A. W. Bates (Ed.), Technology, e-learning and distance education. (pp. 193-209). London New York: Routledge.

Hülsmann, T. (2004) Costing open and distance learning (WBT)
Work through the following sections:
- Costing educational media: Costing distributed e-learning
- Conclusions: Business models and models of cooperation

Lamberson, M. (2003). Course management systems: Trapped content silos or sharing platforms? In C. M. Gynn, Acker, S. R. (Ed.), Learning Objects: Contexts and connections: The Ohio State University.

Rumble, G. (Ed.) (2004). Papers and debates on the costs and economics of distance education and online learning (Vol. 7). Oldenburg: Bibliotheks- und Informationssystem der Carl von Ossietzky Universität Oldenburg.
Read the following sections:
- Rumble, G. The costs and costing of networked learning (2001). (pp. 139-162).
- Rumble, G. The costs of providing student support services (2001). (pp. 163-174).
- Rumble, G. E-Education: Whose Benefits, whose costs? (2001). (pp. 119-138).

Rumble, G. & Latchem, C. (2004). Organisational models for distance and open learning. In H. Perraton, Lentell, H. (Ed.), Policy for open and distance learning. London: RoutledgeFalmer.

Whalen, T., & Wright, D. (1999). 'Methodology for cost-benefit analysis of Web-based tele-learning'. The American Journal of Distance Education, 13(1), 25-43.

Wiley, D. (2003). The coming collision between automated instruction and social constructivism. In C. M. Gynn, Acker, S. R. (Ed.), Learning Objects: Contexts and connections: The Ohio State University.

Additional readings:
Bernath, U., Hülsmann, T. (2004, 4-6 March). Low cost high outcome approaches. Paper presented at the The Third EDEN Research Workshop and International Conference: Supporting the Learner in Distance Education and E-Learning, Oldenburg.

Bishop, T., & SchWeber, C. (2001). UMUC's Online MBA Program: A case study of cost-effectiveness and the implications for large-scale Programs': Sloan Foundation.

Hülsmann, T. (2004, 4-6 March). The two-pronged attack on learner support: costs and the centrifugal forces of convergence. Paper presented at the Third EDEN Research Workshop and International Conference: Supporting the Learner in Distance Education and E-Learning, Oldenburg.

Assignment:
At the end of module 4 students are to submit an assignment that contributes 25 % to the final grade.