The Economics of E-learning - Universitat Oberta de Catalunya

Universitat Oberta de Catalunya
http://rusc.uoc.edu
monograph
“The Economics
of E-learning”
David Castillo-Merino (coordinator)
Summary
Introduction
A Theoretical Framework for the Economics of E-learning
David Castillo-Merino and Mikael Sjöberg 2
1. E-Learning as a Regional Policy Tool: Principles for a Cost-benefit Analysis,
Niklas Hanes and Sofia Lundberg 12
2. E-learning and Labour Market: Wage-premium Analysis,
David Castillo-Merino, Jordi Vilaseca-Requena, Enric Serradell-López
and Natàlia Valls-Ruiz 22
3. Do Online Students Perform Better than Face-to-face Students?
Reflections and a Short Review of some Empirical Findings,
Johan Lundberg, David Castillo-Merino, Mounir Dahmani 35
4. The Impact of ICT on Student Performance in Higher Education:
Direct Effects, Indirect Effects and Organisational Change,
Adel Ben Youssef and Mounir Dahmani 45
5. Describing E-learning Development in European Higher Education
Institutions Using a Balanced Scorecard,
Thierry Garrot, Maria Psillaki and Sylvie Rochhia 57
6. Uses of Information and Communication Technologies in Europe’s Higher
Education Institutions: From Digital Divides to Digital Trajectories,
Adel Ben Youssef and Ludovic Ragni 72
rusc vol. 5 n.º 1 (2008) | issn 1698-580x
http://rusc.uoc.edu
Monográfico
«Contenidos
educativos
en abierto»
Monograph “The
Economics
of E-learning”
artículo
Introduction
Prácticas
y recursos
de educación
A Theoretical
Framework
for the
abierta:
la hoja
de ruta OLCOS 2012
Economics
of E-learning
Guntram Geser
David Castillo-Merino
Mikael Sjöberg
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
The economics of e-learning was identified as a key priority for virtual campuses in the consultation workshop held
in Brussels on 23 November 2004. The eLene-EE (Economics of E-learning) project has aimed to increase knowledge on the incentives to create virtual campuses and initiate teaching methods for education based on ICT and its
effects, ensuring that this is efficiently carried out while reflecting the various situations at the partner universities.
This RUSC special issue on the economics of e-learning shows the theoretical framework we have defined and
some of the results we have obtained within the eLene-EE project, funded by the European Commission.
Our findings have clear policy implications and will help e-learning designers, learners, financers, and decision
makers to build up, adapt, and improve their initiatives. The project is divided into five integrated research and
development work packages (WP) with participants from universities in the eLene consortium (from Sweden,
France, Spain, Italy and Poland).1
Keywords
e-learning, economics of education, knowledge economy, universities, productivity
Un marco teórico para la economía del e-learning
Resumen
La economía del e-learning se identificó como una prioridad clave en el taller de asesoría de campus virtuales celebrado en
Bruselas el 23 de noviembre de 2004. Con esta idea, el proyecto eLene-EE (Economía del e-learning) ha tratado de ampliar el
conocimiento relativo a los incentivos para crear campus virtuales e iniciar métodos de enseñanza en la educación basada en las
TIC y sus efectos, asegurando que esto se lleve a cabo eficazmente mientras refleja las diferentes situaciones de las universidades
asociadas. Este número especial de RUSC sobre la economía del e-learning muestra el marco teórico que hemos definido y
algunos de los resultados que hemos obtenido en el proyecto eLene-EE, que ha sido financiado por la Comisión Europea.
1. For further information on eLene-EE, please visit our site: http://www.elene-ee.net
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A Theoretical Framework for the Economics of E-learning
Nuestros resultados tienen unas implicaciones políticas claras y ayudarán a los diseñadores, estudiantes, financieros y gestores de
e-learning a crear, adaptar y mejorar sus iniciativas. El proyecto se divide en cinco paquetes de trabajo de investigación y desarrollo (WP)
integrados por participantes de universidades del consorcio eLene (universidades de Suecia, Francia, España, Italia y Polonia).
Palabras clave
e-learning, economía de la educación, economía del conocimiento, universidades, productividad
Introduction
network activities and increase knowledge in the economic
sphere. The complex interaction between the emergence
of digital technologies and their production is profoundly
transforming economic activities. ICT has become a key
component of this economic transformation, with the
rise of a new production sector that extends its synergetic
effects not only to other branches of activity, but also to
all other economic activities. This social background of
knowledge has impregnated the economic activity to such
a point that, currently, we can quote a growing number of
interdisciplinary studies that sustain the following hypothesis: ICT is the technical paradigm on which the current
dynamics of the industrial revolution is based.
A consensus has emerged that the diffusion and the
productive use of ICT (through its effects on knowledge
creation and transfer across industries) can be situated at
the material basis of the economic growth of many developed countries since 1995 (Nordhaus, 2002; Jorgenson,
Ho and Stiroh, 2005). The main driving forces behind this
are a combination of the speed of technological change
and product improvement in semiconductors and the continuing fall in their prices. Falling IT prices have provided
important economic incentives for the effective diffusion
of digital technologies among the different industries in
the economy. This rate of price decline is a key component of capital costs, and it can be explained by the impact
of rapidly growing stocks of computers, communication
equipment and software.
Within this analysis of the sources of productivity
growth in the paradigmatic model of the USA, we can
come to three main conclusions: first, in terms of output,
gross output growth, as well as intermediate input growth
and value-added growth can be explained by a set of relatively small industries that produce information and communication technology (computers and office equipment,
electronic components, communication equipment and
computer services) and service industries. Second, in terms
of capital services, the majority of US industries have re-
From an economic perspective, economic and business
activities are characterised by profound changes that modify the behaviour of all economic agents. These changing
trends explain an economic change that can be framed
within a wide context: the emergence of the knowledgebased economy. The development of this new scenario in
developed economies is characterised by rapid knowledge
creation and easy access to knowledge, conditions that
generate greater efficiency, quality and equity (Foray,
2004). The Evidence for the advent of a knowledge-based economy is seen in the increase and improvement of
knowledge-intensive activities throughout all industries
of the economy more than in the continuous expansion of
a specialized productive sector (Eliasson, 1990). The key
differences in economic dynamics from the economies of
earlier periods can be identified in the quality improvement of the production factors through a process based on
the creation of new knowledge and ideas and their incorporation in physical and human capital.
In general terms, this transformation process is based
on a technological revolution – the digitalisation process.
It is built upon a dynamics of spatial and temporal market expansion – globalisation and it feeds back according
to the changes of the patterns of demand of families and
companies. This process has a clear through-line: the intangible value of the economic activity that, in other words,
is the progressive consolidation of a new knowledge-based
economy (Vilaseca and Torrent, 2004).
ICT is not the only causal factor in the global knowledge economy,2 but it is clear that with ICT the knowledge-based economy has found a suitable technological
base because there has been a clear interrelation between
the upsurge of knowledge-intensive activities and the production and diffusion of ICT. Digital technologies are now
consolidated as one of the necessary instruments to develop
2. Authors such as ABRAMOVITZ and DAVID (1996) demonstrate that technological discontinuity can be dated well after the switch of developed
economies towards knowledge-intensive activities.
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A Theoretical Framework for the Economics of E-learning
sponded to declines in relative prices of capital (a direct
externality from ICT-producing industries) and have
shifted their investment patterns to ICT assets, a fact that
is showed by the faster growth in ICT assets than in nonICT assets, and by the growing share of ICT capital in
total capital services; the rapid acceleration of ICT capital
services is a widespread phenomenon that has benefitted
almost every industry, especially those within the ICTusing sector. And third, in terms of labour, the productivity
growth after 1995 has been accompanied by major changes
in the allocation and composition of the work force, since
the positive trend in labour quality during the period 19952000 is explained by the rise in average levels of educational
attainment, as older and less-qualified workers retired and
left the labour force and, complementarily, young workers
improved their education attainment.
The age profile of workers has also changed, with
young workers receiving premium rates closer today to the
more experienced workers than in the past. This empirical
finding is consistent with the hypothesis of a skill-biased
technical change and the existence of complementarities
between ICT inputs and young workers. Therefore, these
results show the effects of the ICT revolution on labour
markets, particularly the fact that college-educated workers
were the main source of employment growth throughout
the period 1977-2000, although the evolution was more
varied in the interval 1995-2000, due to a stabilization
of the education attainment levels and a high economic
growth drawing in workers with lower cognitive skills.
There is a link between productive uses of digital technologies and labour composition; in particular ICT-producing
and ICT-using industries show an increasing demand for
ICT skills, which has been associated an expansion of the
education industry.
Another important conclusion is the considerable variation in labour productivity growth, in TFP growth, in the
quality of labour and employment growth, and in capital
services gains, across industries and across time. This fact
indicates the important differences between industries in
terms of production processes, input demand and allocation, and growth prospects, strengthening the hypothesis of
the existence of complementarities between technical and
organisational change and skilled labour input to explain
productivity gains at the industry level. Nevertheless, it is
remarkable that ICT-producing and the majority of ICTusing industries have experienced a substantial growth in
these indicators since 1995.
It should be pointed out that the diffusion of a new
technology is a long and complex process of building complementarities at many levels, within the concepts of tech-
nological and organisational trajectories and progressive
adjustment of economic and social capacities to a technological revolution (Freeman and Soete, 1997). The full
realization of the potential of ICT (as a general purpose
technology) is a long process that is contingent on significant technical, organisational and institutional adjustments
(Foray, 2004). It must also be taken into account that ICT
requires new industrial and innovative organisations built
around a network and strongly based on digital technologies uses, and that the high degree of innovation in digital
technologies leads to the need for continuous adaptation to
a perpetual and radical technological change that underlies
the economic base of productivity gains. In other words, an
organisational culture of change is needed at the company
level to deal with the constant upgrading of software and
hardware that leads to constraints of interconnectivity and
interoperability for the user.
The way to address the issue of ICT complementarities
has emerged as a focus of analysis in the industrial organisation literature, within the framework of the investment
theory. From this perspective, the two main adjustment
categories in the process to exploit the potential benefits
of ICT usage at the company level are concentred in the
organisation of the production processes and the demand
for specific skills and abilities.
Concerning the first category, we adopt the thesis that
the main driver of organisational change in firms is the need
to adapt to changing competitive conditions. In this field,
there is a mutually beneficial relationship between organisational change and ICT investments. Digital technology
is a key element to facilitate new organisational practices,
such as lean production, team-working, more decentralization in strategic decision making activities, and a closer
interaction with customers and providers of intermediate
inputs (Bresnahan et al., 2002; Cristini et al., 2001). Therefore, ICT availability and usage increase firms’ capacity to
adapt their organisational structure to these new network
requirements. At the same time, efficient ICT use by firms
requires some specific organisational changes in order to
maximize the exploitation of their technological capabilities. How ICT and organisational change are combined
within a firm will determine the efficiency level achieved
and, therefore, the degree of productivity gains. Company-level organisational change can take many forms, but
they can generally be classified into three broad systems
(Murphy, 2002): 1) The restructuring of production processes (including Total Quality Management practices, lean
production systems, Just-In-Time methods and business
re-engineering processes); 2) Management systems and
employee involvement schemes (with practices such as
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A Theoretical Framework for the Economics of E-learning
decision-taking decentralization, teamwork, knowledge
management, flexible work arrangements and flexible
compensation); and 3) External re-organisation that emphasises customer orientation, outsourcing and company
networking.
There is also an important relationship between development and diffusion of digital technologies and demand
for specific skills and abilities devoted both to the production industries of technological innovation and to labour
input of the broad economy. These skills can be separated
into two main classes: 1) cognitive (or technical) skills related to ICT production and use, especially those needed
for the correct use of digital technologies that allow individuals to surpass the constraints derived from the continuous and accelerated upgrading of digital innovations;
and 2) non-cognitive skills (or “soft-skills”) or abilities
that are not directly related to the production requirements but also necessary because they enhance individual
development and social participation (Levin, 1998). The
latter includes entrepreneurship, adaptation to changes,
cooperation, teamwork, knowledge transmission, problem
solving, decision making, information management, selfprogramming, learning abilities (especially bias to continuous learning or “long-life learning”) and communication
skills; these abilities are not new, but they are crucial to
fit the new technical change requirements and to keep up
with the constant change in economic activities.
There is a large amount of empirical evidence that
demonstrates the beneficial effects in terms of company
productivity of these complementary relations between
the two above mentioned innovations, ICT adoption and
organisational change, and the demand for skilled workers.
The main conclusion from this work is that company performance improves when digital use is accompanied and
co-integrated with a re-organisation of business processes
and labour management, and the participation of more
qualified workers.
In summary, education has a critical role in sustaining economic and productivity growth based on ICT
investment and usage, not only for its direct allocation
to the innovation processes of those industries responsible for knowledge creation, but also for its importance
in efficient use of digital technologies by workers across
industries in the economy and the improvement of the
individual’s capacities for knowledge management, transfer and productive usage. Therefore, organisations on the
supply side of the education industry, where universities
are included and have an important role, have significant
challenges along two main lines: 1) to generalise access to
education across the population and encourage the im-
provement of educational attainment levels, to respond to
the social demand of a life-long learning offer, and to fit
with workers’ needs for specific skills and abilities, and 2)
to adapt their organisational and institutional structure to
the innovation process for effective and efficient ICT use
in teaching and management activities through the adoption of new business models, and to achieve an intensive
use of digital technologies in the teaching and learning
processes (courses and programs) in order for students to
attain the ICT skills and abilities required in the labour
market by teaching them how to use and, what is more
important, how to apply digital technologies to their professional activities.
In this field, e-learning is an opportunity to encourage a
general ICT policy in universities that can favour their organisational adaptation to digital requirements in terms of
better performance, and to offer students a continuing education that may lead to the development of skills better linked
with the production needs of the knowledge economy.
Positive externalities of e-learning
Education must be considered as a key investment in modern economies because, as we have shown, within the framework of a knowledge-based economy there are strong and
positive complementarities between economic activity and
education in the explanation of economic growth. E-learning can contribute to the beneficial dynamics by increasing
access to education in society as a whole, avoiding traditional
constraints related to space, time and pace of teaching and
learning systems, and allowing education access to many
people who would otherwise not enrol on courses.
We can affirm that education leads to important benefits, both for individuals and for society as a whole. In economic terms, human capital accumulated as a result of the
educational process should be considered as a mixed good,
i.e. a private good with public externalities. The nature of
education goods leads to the distinction between private
and social educational benefits.
From the point of view of the individual, and following
the human capital theory approach, the increase in an individual’s level of educational attainment is consistent with an
increase in their productivity in the labour market, which
is the reason for higher wages for more educated workers. Since the time of Mincer (1974), who estimated that
around 10% of wage increases in the USA was attributable
to an individuals’ schooling, a huge amount of empirical
evidence3 has demonstrated a high positive correlation be-
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A Theoretical Framework for the Economics of E-learning
tween individuals’ educational levels and wages. Therefore,
taking into account age and experience, better-educated
workers earn more than their less-educated peers (Cipollone, 1995). However, education is not the only explanatory variable of wage differentials. There are other variables,
sometimes difficult to measure, affecting labour market
outcomes: individuals’ innate ability, social and economic
status, family background or other social factors. But, as
pointed out by Hinchliffe (1995), earnings functions and
path analysis of the effects of individuals’ background characteristics on occupational attainment and earnings have
indicated that, while much of the variance remains unexplained, the largest single indicator is education. Indeed, it
has also been proven that a virtuous circle arises within the
complementary relations between education and income,
so that education can explain higher earnings for workers
while higher income causes increases in the demand for
education (Sianesi and Van Reenen, 2002).
Other benefits from higher levels of education, directly
related and complementary to wages, are 1) the increased
likelihood of participating in the labour market and 2)
the decreased probability of being unemployed. Participation in the labour market and unemployment rates are
closely related to education (OECD, 1997 and 1998; De
la Fuente, 2003), and help to explain the economic benefits
for individuals.
An important concern is that the benefits of educational investments for individuals extend beyond increases in
earnings and employment conditions to other factors that
have an indirect effect on economic benefits. Education has
a positive impact, among others factors, on health (Taubman and Rosen, 1982; Desai, 1987), on intergenerational
cognitive development (Angrist and Lavy, 1996; Lam and
Dureya, 1999), on developing more rational organizational
and financial competence, and better analytical skills (Lassibille and Navarro Gómez, 2004), on a greater likelihood
of participating in politics and social decision mechanisms
(Campbell et al., 1976), on adopting a better consumption
technology and a greater efficiency in making consumer
choices (Rizzo and Zeckhauser, 1992) and on higher rates
of saving (Solomon, 1975). All these additional advantages
are real benefits from education but they are difficult to
measure in monetary terms.
From a social point of view, education plays an important role in determining the level and the distribution of
income, in company (and institutions in general) productivity and in economic growth.
Firms and institutions benefit from the disposal of
more educated employees through two main channels: 1)
through the positive effect of education and training on
the improvement of productivity levels and rates of growth
(Dearden et al., 2000; Bresnahan, Brynjolfsson and Hitt,
2002), and 2) through the spill-over effects from bettereducated workers. Therefore, the effects of higher levels of
educational attainment are shown not only in the higher
productivity of educated workers, but also in the increase
of other workers’ productivity as a result of learning by imitation and improving their skills from working with them
(London Economics, 2005).
For society as a whole, the empirical evidence suggests
that there is a positive relation between education (through
human capital formation mechanisms) and economic growth
(Lucas, 1988; Romer, 1990; De la Fuente and Ciccone, 2002;
Jorgenson, Ho and Stiroh, 2005), with special force when
technological change is considered (Psacharopoulos and
Patrinos, 2004). These economic benefits estimations are
usually based on gross wages across the economy and on the
fiscal incomes derived from industries’ economic growth.
There are also other social benefits that indirectly affect performance of economies through different channels.
Education produces external effects that have a positive
incidence on agents other than those benefiting from it.
These externalities, such as social cohesion, political stability, and citizen participation in public policy issues, are
difficult to identify and, even more so, to measure. Nevertheless, some authors have tried to identify and quantify
educational externalities (Weisbrod, 1964; Havenam and
Wolfe, 1984; Heckman and Klenow, 1997; McMahon,
2000; Acemoglu and Angrist, 2000; or Davies, 2002) by
three main methods: 1) consumer surplus or welfare improvements, 2) expenditure on related private goods, and
3) hedonistic pricing models. The results of these studies show that the extent of social spill-overs explains the
existence of significantly higher returns on investment in
education for societies. The most plausible sources of these
externalities are the link between human capital and the
rate of technological change, and the indirect effect of education on productivity and employment through the quality of institutions that may be considered as a component
of social capital (De la Fuente and Ciccone, 2002).
3. Some recent contributions to this field are: DE LA FUENTE (2003), HARMON, WALKER and WESTERGAARD (2001), CARD (2001),
ASHENFELTER, HARMON and OOSTERBECK (1999), LASSIBILLE and NAVARRO GÓMEZ (1998), OECD (1998) and PSACHAROPOULOS (1994).
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In addition, the increase of individual and social human capital allowed by e-learning provision and e-learning
contribution to develop workers’ e-skills may help to reduce
skill-biased technological change effects on wage distribution in labour markets.
From the point of view of labour economics, it is well
documented by both theoretical developments and empirical
findings that technological change has a significant impact
on the labour market. This topic has been an important concern of economic research, and the discussion has intensified
in the two last decades due to the general ICT adoption in
the economic sphere (Spitz, 2003). A key observation in this
field is that highly skilled workers, and especially those with
higher levels of educational attainment, are more likely to
use computers in their job (Krueger, 1993). These facts have
led to a major consensus in the labour economics literature
that a burst of new technology causes a rise in the demand
for highly skilled workers, which in turn implies an increase
in the wages of skilled workers relative to unskilled workers.
This hypothesis is known as the Skill-Biased Technological
Change (Acemoglu, 2002; Acemoglu, 1998).
Some research (Berndt et al., 1992; Berman et al., 1994;
Kaiser, 2000) has shown that during the last decades there
has been a structural shift towards the increase in deployment of white-collar work in most sectors of developed
economies and a rise in employment of workers with high
levels of formal education. Moreover, other studies (Wolff,
2000; Autor et al., 2001) have found that the change in
employment patterns resulted in an upgrading of cognitive
and interactive skills and a decreasing demand for manual
skills. This is simultaneous with the increase of ICT investment and adoption by firms. The link between ICT and the
demand for high-skilled labour is due to the fact that the
introduction of digital technologies alters the skill requirements of occupations in three main ways (Spitz, 2003): 1)
ICT capital substitutes repetitive manual and repetitive cognitive activities, 2) ICT capital is complementary to analytic
and interactive activities, and 3) ICT capital increases the
requirement for computing skills. This relation underlies the
evidence that compared to previous technological revolutions
(that aimed to routinize manual tasks), digital technologies
are additionally capable of replacing simple human cognition
such as perceiving, choosing and manipulating processes, and
searching and managing information. Additionally, computer
technologies are complementary to analytical and interactive
activities. There is also evidence that ICT capital does not
substitute whole occupations, but is limited to certain tasks.
This limited substitution relationship, pointed out by Bresnahan (1999) shifts the demand for labour towards workers
with higher levels of education who are considered to have a
comparative advantage in performing analytical and interactive tasks. Thus, computer technologies shift the relative skills
requirements of occupations towards analytical and interactive activities.
E-learning in higher education
Universities stand at the centre of the knowledge-based
economy development as they are currently one of the main
agents providing education within the education industry.
There has been major development in the education
industry in recent years in part as a consequence of the
growing empirical evidence on the effect of improving
educational attainment on economic and productivity
growth. The increase of the education market has also been
facilitated by the emergence and diffusion of digital technologies. The use of ICT in the production process that
leads to the provision of education and training is transforming the way education suppliers are developing this.
New opportunities have emerged to integrate pedagogical
and technological resources, to increase flexibility across
the learning process, and to improve communication between teachers and students and the interaction between
different educational resources (Collis, 1996). The increasing use of ICT and particularly Internet in the educational
process of universities across OECD countries explains
the growing adoption of e-learning systems and the development of online courses in universities (European Co
mmission, 2004; University of Southern California, 19902006; OECD/CERI, 2005).
The digital-based change in the provision of education
is not constrained to the teaching and learning process, but
also affects organisational structure and management practices of education suppliers.
Since the mid-nineties there has been an increasing
belief that the use of e-learning systems in universities may
lead to improved efficiency in the production of education,
in terms of scale (number of student enrolments), students’
achievement and costs (OECD, 1998).
Vilaseca and Castillo (2005) have studied six e-learning universities around the world4 over a period of time
4. These universities are: Athabasca University (Canada), Capella University and Jones International University (United States), the Virtual University
of Monterrey Technologic Institute (Mexico), the Open Learning Agency (Australia) and the UOC (Universitat Oberta de Catalunya), Spain.
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WP 1. Cost-benefit analysis of net based
higher education
in order to analyse the determinants of cost-efficiency in
e-learning production by universities. The results show
that cost-efficiency is due to three complementary effects:
1) the attainment of scale economies based on high fixed
costs and low marginal costs; 2) the enablement of productive capacity expansion without an increase in fixed costs
and 3) the trend towards a rise in variable costs consistent
with decreasing marginal costs.
Therefore, e-learning production by universities will be
accompanied with a relative high investment in ICT infrastructure and digital applications, as well as in methodological issues (course designs, didactic materials, etc.) and labour
adjustments at the university level. This capital accumulation
required for e-learning development may lead to a saving in
costs, especially if universities are able to exploit some economic benefits based on the use of digital technologies.
There is already empirical evidence that e-learning
policies in universities are important driving forces for
quality improvement and strategic planning promotion.
Following on from this, universities must continue with
the research on efficient institutional models for the provision of high quality education based on the use of digital technologies.
The main question in WP1 is whether or not e-learning
is an efficient use of resources, i.e. what are the main benefits and costs for society? One important aspect of the
analysis is to consider effects, or outcomes, for different
stakeholders (e.g. students, universities and policy makers).
Although an investment may be beneficial for one stakeholder, it might not be beneficial for another. This raises
the question of how costs and benefits should be divided
between stakeholders in order to create a correct incentive
structure.
WP 2. Student performance of e-learning
The main questions in WP2 are whether the uses of ICT
affect student performance and whether the uses of ICT
affect student performance differently depending on the
subject. These are two important questions that need attention in order to ensure quality in and efficient training
from virtual mobility including the right choice of tools
available from existing technology. WP2 aims to provide
answers to these questions with hypotheses and data from
ongoing training and data from a carefully designed experimental set-up performed within the WP. Students
performing well are a condition for creating benefits in the
context of WP 1.
eLene-EE (Economics
of e-learning)
In this special issue of RUSC on the economics of e-learning, some results of the eLene-EE project are presented in
different papers. eLene-EEwww1 is a project of the eLene
group (e-learning network) funded by the European Commission e-learning programme, running from February
2006 to July 2008.
The above sections contain the main questions eLeneEE researchers aim to address in order to discuss and provide evidence on which variables make virtual campuses
and e-learning provision by European universities an efficient way to provide higher education: How much does it
really cost to set up and run a virtual campus? What impact
does e-learning have on student performance and what are
the possible spill-over effects? What indicators do we have
at our disposal to track the efficiency of e-learning? And
can e-learning help to bridge the digital divide?
These topics are analysed in the four core content workpackages of the eLene-EE project:
WP 3. Indicators of e-learning
The WP3 partners decided to work on indicators relevant
at the HEI level and indicative of the regional, state or European ICT policy. Our aim is to collect data on indicators
of e-learning progression in HEI with information characterising them and useful to aggregate and analyse data on
policy perspectives. In consequence, we will work with a
double approach. One is at the micro economic level, based
on HEI business and management perspectives, integrating
dimensions of the quality of services provided to the customer and specific indicators with a Balanced Score Cards
approach. The other is at the macro economic level, looking
at e-learning progression in our societies to identify indicators of its development.
[www1] http://www.elene-ee.net/
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WP 4. Digital divides and e-learning
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While the dividend of educational ICT seems obvious, countries may not meet the appropriate conditions in using these
technologies and may fall into the digital divide. These technologies may enhance social exclusion and different groups
within the societies will not benefit from them. The aims of
this Work package 4 are threefold: Firstly, we want to characterize the variety of digital divides in matters of educational
ICT and to understand how to bridge them. Secondly, we
want to illustrate the differences of the digital divide in terms
of uses, what factors contribute to it as well as its various forms.
There will be a special focus on the concepts of digital choices
and digital trajectories. Thirdly, we will look at the main explanations of digital divides in matters of performance. Why
do some institutions, students, countries perform better than
others? Is there any “productivity paradox” in the higher education sector? Is there a “Skill Biased Technological Change”
in matters of educational ICT?
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Recommended citation
castillo, david; sjöberg, mikael (2008). “A Theoretical Framework for the Economics of E-learning”. In: “The
Economics of E-learning” [online monograph]. Revista de Universidad y Sociedad del Conocimiento (RUSC). Vol. 5,
no. 1. UOC. [Accessed: dd/mm/yy].
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About the authors
David Castillo-Merino
Assistant Lecturer at the Department of Economics and Business of the UOC
[email protected]
Dr. David Castillo-Merino holds a position as Assistant Lecturer at the Department of Economics and Business of
the UOC. He is a member of the New Economy Observatory (IN3-UOC) research group. He is director of Masters
in the field of Corporate Finance. His research interests and areas of expertise include: the economics of intangible
assets, finance and innovation in firms, and e-learning and is an author of books and papers in these areas. He
participates in the European eLene-EE project on the economics of e-learning.
Mikael Sjöberg
Umeå University
[email protected]
Dr. Mikael Sjöberg has worked as a pedagogical consultant since 2000 at Umeå University and the Swedish
University of Agricultural in Umeå. His main focus during this time has been ITC and learning in a university
environment, both from the teacher as well as student perspective. He also has a doctorate in behavioural ecology
as well as a degree for secondary school teaching (ages 16-19).
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and Mikael Sjöberg (coordinators)
MikaelCastillo-Merino
Sjöberg
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Monograph “The Economics of E-learning”
article
E-learning as a Regional Policy Tool:
Principles for a Cost-benefit Analysis
Niklas Hanes
Sofia Lundberg
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
A bill presented by the Swedish Government in 2001 stated that higher education should aim for a broader recruitment of students. The use of ICT-tools is pointed out as a way of reaching new student groups, e.g. students
who are immobile due to their social situation or physical handicap. At the same time, a number of regions in
Sweden struggle with negative net migration that is to a large extent driven by labour market conditions and
younger people moving away for higher education. These regions experience a shortage of human capital within
certain competence areas. In line with the aim of the government bill, national and local governments tackle this
by integrating higher education and regional policy; i.e. bringing higher education to the inhabitants in an attempt
to target groups such as those with strong bonds to the region hoping to encourage them to remain in the region
after graduation. Higher education is costly and it is the local governments who bear the added cost of bringing
education to the inhabitants. In order to minimize costs, programmes and courses are therefore given by the use
of ICT-tools. The degree of net-based training (e-learning) varies over programmes and courses from 100 percent
net-based to blended learning. At least three questions are important when deciding whether or not to invest
in net-based higher education: Are new target groups reached? Is the net-based education of the same quality, or
higher, compared to the alternative on-campus programme? Is the investment motivated from a welfare perspective? The aim of this paper is to analyse e-learning as a regional policy tool and present the principles for social cost
benefit analysis concerning net-based higher education. In addition, empirical evidence from a Swedish case study
is briefly presented.
Keywords
cost-benefit analysis (CBA), economics of e-learning, net-based higher education, regional policy
JEL classification: D61, I21, I22, I28
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E-learning as a Regional Policy Tool: Principles for a Cost-benefit Analysis
E-learning como herramienta de política regional: principios para un análisis de
coste-beneficio
Resumen
Un proyecto de ley presentado por el gobierno sueco en 2001 manifestaba que la educación superior debe fijarse el objetivo de atraer
una mayor diversidad de estudiantes. Se habla de las herramientas TIC como un medio para llegar a nuevos grupos de estudiantes,
p. ej., estudiantes que no pueden desplazarse debido a su situación social o a una discapacidad física. Al mismo tiempo, varias
regiones de Suecia se enfrentan a una migración neta negativa que en gran parte está motivada por las condiciones del mercado de
trabajo y por el desplazamiento de los jóvenes a otros lugares para poder acceder a la educación superior. Estas regiones sufren un
déficit de capital humano en ciertas áreas de competencia. Haciendo frente común con el objetivo de este proyecto de ley del gobierno,
los gobiernos nacionales y locales tratan de ofrecer soluciones integrando la educación superior y la política regional, es decir, llevando la educación superior a los habitantes en un intento de dirigirse a grupos como los que tienen fuertes lazos con la región, con
la esperanza de alentarlos a quedarse en ella después de completar sus estudios. La educación superior es cara y los gobiernos locales
son quienes se hacen cargo del coste adicional que supone llevar la educación a sus habitantes. Por tanto, para minimizar costes, se
imparten programas y cursos con ayuda de herramientas TIC. El grado de formación impartido por Internet (e-learning) varía de
un programa y curso a otro, desde un 100 por ciento de aprendizaje impartido por Internet a un aprendizaje de tipo mixto. Hay al
menos tres cuestiones importantes a la hora de decidir si invertir o no en educación superior impartida por Internet. ¿Llega a nuevos
grupos objetivo? ¿Es la educación impartida por Internet de la misma calidad, o superior, en comparación con el programa impartido en el campus? ¿Está motivada la inversión desde una perspectiva de bienestar social? El propósito de este estudio es analizar el
e-learning como una herramienta de política regional y presentar los principios de análisis de coste-beneficio correspondientes a la
educación superior impartida por Internet. Además, se presentan brevemente datos empíricos de un caso práctico sueco.
Palabras clave
análisis de coste-beneficio (ACB), economía del e-learning, educación superior impartida por Internet, política regional
1. Introduction
national and local governments integrate regional policy
and higher education by implementing net-based programmes and courses that otherwise are only available as
on-campus education.
The purpose of this paper is to discuss net-based higher
education (e-learning) as a regional policy tool in the context of a social cost-benefit analysis. The paper presents results from a case study in the northern part of Sweden (the
Academy North3 region) where a net-based nursing programme is analysed. The net-based nursing programme is
compared to a similar on-campus programme, e.g. student
characteristics and cost structure. Since the programme
was initiated partly as regional policy, the case study contains a national analysis and a regional analysis in order
to highlight the incentives of the stakeholders to promote
the programme, i.e. the university, the region and the national government. The difference between the regional
In 2001 the Swedish Government presented its initiative to
broaden recruitment to universities and university colleges.1 One aim of the policy is to reach students from socially
and ethnically underrepresented groups. The initiative also
targets individuals who, due to physical handicap or social
situation cannot move for higher education. The use of
information and communication technology (ICT-tools)
is mentioned as a means to target these groups (in the following this will be referred to as net-based education or
training).2 At the same time sparsely populated regions of
Sweden (foremost inland) struggle with negative net migration, to some extent driven by younger people moving
away for higher education (Eliasson, 2001). One consequence is that the municipalities experience a shortage of
human capital. In order to mitigate this development the
1. Proposition 2001/02:15.
2. Proposition 2001/02:04.
3. The Academy North is a consortium of 13 municipalities in the four counties that define northern Sweden.
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E-learning as a Regional Policy Tool: Principles for a Cost-benefit Analysis
and national analysis depends on which costs and benefits
are considered. In the national analysis, all costs are taken
into account and all students and their future income flows
are considered, regardless of the place of residence. In the
regional analysis, only funding by municipalities in Academy North is considered and students working outside the
region after their exams are not taken into account. This
means that regional costs are lower compared to national
costs. However, on the benefit side, the region is vulnerable
to out-migration of the labour force. If a newly-educated
nurse migrates from the region, the region loses the expected benefit; as long as the individual migrates within
Sweden, the national analysis is indifferent between places
of residence. In the case study, three important questions
are highlighted. Firstly, is it possible to reach new student
groups by the use of e-learning tools? Secondly, are elearning programmes and courses of the same quality as
similar on-campus education? Thirdly, are investments in
e-learning motivated from a welfare perspective? The latter
discussion also concerns different incentives among stakeholders that may constitute restrictions when e-learning
programmes are implemented.
The social cost-benefit analysis is essentially a tool for
supporting decision-making by the government. At a given
point in time the society has a given amount of resources,
such that politicians are faced with the problem of ranking different policy options. Cost-benefit analysis is used
to answer the question whether resources within a project
are used efficiently for the society as a whole compared to
an alternative case. The decision rule is very simple; select
the alternative if the net benefit of the investment is higher
compared to the next best project. This ranking implies
that the costs of the best project are the benefits of the
next best project. Thus, the social cost-benefit analysis is
generally concerned with the “alternative case” and what
would have been done in the alternative case.
The social cost-benefit analysis should not be confused
with traditional analysis of net present values of financial costs and benefits. The objective function in a social
cost-benefit analysis is citizen welfare and the objective
of the financial appraisal is profit maximisation or a balanced budget. Perhaps the right question to pose is why
net present values of financial costs and benefits are not
a sufficient decision basis for ranking policy options. The
simple answer is that the concept of citizen welfare is
much broader than market concerns, i.e. effects that are
not assigned market prices. Furthermore, from a policy
viewpoint, the social consequences of a project may be of
great importance, e.g. intertemporal concerns or distributional consequences for different groups in the society.
However, it is important to note that the direct financial
costs and benefits are important, since a department or
university will not provide a course or a programme that
is unprofitable. Thus, an investment that may be beneficial
in the context of social cost-benefit analysis may not be
realised since financial burdens affect incentive structures
for stakeholders.
This paper is organised as follows. In the next section
we present the basics of cost-benefit analysis and the application to the present case study. Section three is a summary of the case study, and section four contains a short
discussion.
2. Cost-benefit analysis
The social cost-benefit analysis (CBA) is a tool for supporting decision-making by governments ranging from
international to local levels. The welfare of the citizens is
the primary interest in a cost-benefit analysis. In the best
of worlds, a cost-benefit analysis considers all effects that
directly or indirectly affect the welfare of the citizens.
The starting point for the analysis is that aggregate
production (GDP) requires resources today while giving
consumption opportunities today or in the future. Put
simply, the main benefit of a project is the value of the
production increase that follows. The main purpose of the
cost-benefit analysis is to evaluate whether resources are
used efficiently in a project compared to some reference
alternative. This builds on the assumption that resources
are scarce and as such always have an alternative use. The
values of the alternative use are the costs that are associated with the project. Thus, the effects that are generated
by a project, measured in costs and benefits from a society
perspective, must be compared to an alternative situation,
e.g. when the project is not implemented.
As mentioned earlier, social cost-benefit analysis
should not be confused with the analysis of financial net
present values. With higher education as an illustrative
example, a financial analysis of the costs and benefits of
an investment targets a department, a faculty or the university, while a (social) cost-benefit analysis focuses on the
same investment but considers its effects on the society as
a whole. A department, for example, facing an investment
in an online-based course or programme is probably concerned with the opportunities of scale in terms of more
students reached per teacher hour invested or if it could
lead to increased quality compared to face-to-face training
and better student performance (Lundberg, 2007; Coates
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E-learning as a Regional Policy Tool: Principles for a Cost-benefit Analysis
et al., 2004; Brown and Liedholm, 2002). This analysis
ends when the student leaves the education programme. A
cost-benefit analysis also follows the student after training
and considers the potential productivity increase as well as
non-marketed effects that may follow from higher education.
A cost-benefit analysis is characterised by the transformation of all effects to monetary values including those
which are not associated with actual transfers of money.
Some effects are of course very difficult to express in monetary terms. It is inevitable that a cost-benefit analysis concentrates on effects that can be quantified. In the following
sub-section, the basic steps of a cost-benefit analysis will
be presented.4 The structure of a cost-benefit analysis may
of course differ for different applications but in general it
includes the following steps:
analysis, individuals are given the opportunity to stay in
their region and study and work, although this opportunity
is clearly beneficial for the individual and the region, the
monetary value is difficult to determine. However, since
net-based higher education is a policy tool for reaching
new student groups and to encourage an educated labour
force to stay in sparsely populated areas, the government
has put a certain value on these effects.
2.1.1. Costs
In the context of a cost-benefit analysis, costs are defined
as opportunity costs, i.e. the value of the resources in an
alternative use. Taxes and transfers are generally not seen
as costs in the cost-benefit analysis. Taxes and transfers
represent flows of income between individuals and sectors
in the economy. For example, study loans and study grants
are transfers and not a cost in the context of a cost-benefit analysis. However, the external effects that are caused
by taxes may generate costs (the marginal cost of public
funds). There are two different ways to approach the costs
of an investment. One is to see the investment as a having
a partial effect on the economy (small projects). This means
that the investment does not affect the relative prices in the
economy. The other way is to analyse the investment in a
general equilibrium framework, i.e. the investment alters
relative prices, which will have consequences for the whole
economy (large projects). The case study discussed later
only considers the partial effect.
The costs associated with an education programme
may be sorted into the following categories:5
1. Identification of costs and benefits
2. Quantification of costs and benefits
3. Calculation of net present values
4. Decision criteria
5. Sensitivity analysis
2.1. Identification of costs and benefits
The main benefit of education is the potential effect on
productivity. Education is expected to enhance knowledge
and skills, which in turn affects productivity and income,
which is beneficial for the individual as well as for the society. A possible way to measure productivity is to study
wages. There is extensive empirical literature on the wage
premium of higher education. When cost-benefit analysis
is conducted in connection to the implementation of an
education programme it is difficult to rely on estimated
wage premiums since a relatively long period after graduation is required in order to identify the effect. Therefore,
case studies can for example be based on observed wages
before and after education or observed wage statistics for
the specific work category. However, this kind of measure
is imprecise and can not reveal the real effect of the particular education programme that is studied.
It is possible to think of other benefits that are nonmarketed but nonetheless important to consider, e.g. benefits that an individual may experience from education, other than receiving a job and higher earnings. In the regional
•
•
•
•
•
Production losses
The value of the personnel in the alternative case
The value of the premises in the alternative case
Depreciation of inventories
Goods and services associated with the education
2.1.2. Production losses
There is an important production loss as a result of students who choose to study. The value of the production in
the alternative case must be considered in the cost-benefit
analysis. Consequently, the alternative cost of an unem-
4. See e.g. LAYARD and GLAISTER (1994), HULTKRANTZ and NILSSON (2004), BRENT (2006).
5. This classification follows AXELSSON and LÖFGREN (1992).
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E-learning as a Regional Policy Tool: Principles for a Cost-benefit Analysis
ployed person taking part in a project is zero, or equal to
the individual’s utility from leisure. If it is assumed that the
labour market is in equilibrium we know that the student’s
utility from leisure is at least as large as the wage they
could have had if they had chosen to work. If the student
had been employed prior to education this is a good approximation of the value of the production losses.
have to be included in the calculation of the total cost. A
service could for example be promotion costs paid to an
advertising agency.
2.2. Quantification of costs and benefits
Estimations of future production values as well as different
costs are by nature associated with a high degree of uncertainty. When conducting case studies, surveys and official
labour market statistics can be used in order to quantify
costs and benefits. Calculations of production losses can
be based on wages that are reported in the surveys, i.e. the
wage prior to the education programme.
For several reasons, it is very difficult to predict future
production values, e.g. to what extent is higher education
expected to affect labour market behaviour such as labour
supply and retirement age? Some assumptions have to be
made, e.g. that labour market behaviour is not affected by
the individual’s education choice. The assumption of similar labour market behaviour between the two cases is a very
simplified assumption that may be questionable, e.g. in a regional analysis it is likely that education and career choices
do affect migration decisions. Furthermore, it is difficult to
estimate future productivity changes; one (risky) assumption
is that productivity increases are the same between the two
cases, i.e. the case where the individual chooses the education programme (the case observed) and the alternative case
where the individual stays in the former occupation.
A cost-benefit analysis of a net-based programme or
a course necessitates that the departments and other organisations involved in the development and performance
of a programme identify and estimate all costs. This includes direct as well as indirect costs. It is important to
note that the figures that appear in the budget are not the
true alternative costs. However, it is reasonable to assume
that these figures represent the value of the resources in the
alternative case, e.g. why should the value of a computer or
a teacher be different in another situation? Some costs may
be difficult to estimate, e.g. extra time spent by ambitious
teachers in the development phase. One way to collect this
data is to perform interviews and ask involved teachers
about time spent outside work time.
2.1.3. The value of the personnel in the alternative case
Implementing a new education programme requires more
working hours for university teachers. It may be difficult to
obtain information about their activity in the alternative
case. However, a reasonable assumption is that the value
of their contribution to production in the alternative case
is the same as the cost that arises in the programme that
we study. Another possible outcome is that the university
values the experience of the teacher gained from working
with net-based training compared to traditional face-toface (if this is the alternative) and that this is expressed as
an increase in wage that otherwise would not have been
the case. If so, the added value of increased knowledge
should be included in the analysis.
2.1.4. The value of the premises in the alternative case
Provision of net-based programmes involves the use of university premises to some degree. Streamed video lectures
need to be recorded, teachers and administrative staff need
offices and so forth. Furthermore, if face-to-face meetings
with the students are scheduled, premises are needed. The
use of these premises has an alternative value. Therefore the
cost (such as rental and depreciation) should be included.
2.1.5. Depreciation of inventories
As in the case of premises, inventories such as office furniture and equipment have an alternative use and therefore
an alternative cost that needs to be considered. The depreciation value is the best approximation to the alternative
cost for inventories.
2.3. Calculation of net present values
2.1.6. Goods and services
An education programme gives rise to costs today while
the main benefits arise in the future; i.e. production values up to the year of retirement. Future costs and benefits
If development and implementation of the programme is
associated with the purchase of goods and services, they
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have to be discounted in order to be comparable. A project
requires resources today, which means that consumption
opportunities today are restricted. A positive discount rate
implies that individuals prefer consumption today compare to consumption in the future. The basic criterion is
that the discount rate should reflect the individual’s time
preference discount rate. In a perfect market economy the
time preference rate equals the interest rate that reflects
the individual’s choice of consumption today and in the
future. In reality there is no unitary interest rate. Since the
choice of discount rate to some extent is arbitrary, the effect of different rates should be analysed.
e-learning programmes and on-campus programmes? A
nursing programme provided on campus by Umeå University has been used as a comparison. One purpose of the case
study is to discuss net-based higher education as a regional
policy tool. Different interests at the national, regional and
local level are identified which may affect the implementation of this kind of investment. Some key elements of the
case study are now briefly discussed.
An extensive survey has been used to collect data describing student characteristics. The survey contained questions including those concerning age, family, education, occupation prior to education and labour market outcome.
2.4. Decision criteria
Background
The net present value is used as the decision criteria in this
analysis. The costs and benefits are discounted to present
values and if the discounted benefits exceed the discounted
costs, the net social benefit is positive.6
The inland of the northern part of Sweden is sparsely
populated and the majority of municipalities are struggling
with depopulation and shrinking tax bases. The region has,
for a long time, been characterised by negative net migration, a process that is driven by labour market conditions
and people moving away for higher education. One consequence of this development is that there is the risk of a
shortage of human capital within some areas, for example
health care. The nursing programme analysed in the case
study was initiated by Academy North, a consortium of
13 municipalities as a direct response to the lack of nurses
in the region. The nursing programme was hosted by the
Lycksele municipality (130 km from Umeå), where a study
centre was located. The nursing programme was provided
by the Nursing Department at Umeå University.
2.5. Sensitivity analysis
There are several sources of uncertainty in the analysis. Thus,
it is very important to evaluate how sensitive the result is for
small changes in key variables. One key factor in the costbenefit analysis is the discount rate. A higher discount rate
implies that the present value of future benefits and costs
decreases. Due to the fact that the choice of discount rate
is arbitrary to some extent, it is important to evaluate how
sensitive the result is to changes in the discount rate.
Stakeholders
3. A case study of a nursing
programme
One important aspect is that several stakeholders are involved, with three main stakeholders, the Academy North,
the Ministry of Education and Umeå University sharing
the costs for the programme. It is important to identify
the stakeholders since the outcomes for the different stakeholders may constitute important restrictions for the implementation of this kind of project. In this paper, the investment decision is seen from two perspectives, Academy
North and the national government. This is done in order
to highlight the regional dimension of the investment.
The national government provided resources to the
same extent as for on-campus education; added costs for
In this section we briefly present some results from a case
study of a nursing programme in Sweden. The discussion is
mainly based on Fåhraeus and Lundberg (2002) and Lundberg (2005). The case study illustrates a possible strategy for
analysing an e-learning programme in the context of a social
cost-benefit analysis. Some key questions are highlighted in
the case study, e.g. is it possible to reach new student groups
that otherwise would not have participated in traditional
on-campus education? Are there quality differences between
6. Net present value = ∑Bt(1+i)-t - ∑Ct(1+i)-t, where B is benefits, C is costs , i represents the discount rate and t the time period.
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the net-based programmes are financed by the municipalities. It is therefore important to conduct the cost-benefit
analysis for the national government as well as for the region (the consortium of municipalities). This approach can
identify different incentives for the stakeholders, but also
the pre-requisites for successful investment from the perspective of the different stakeholders. It should be noted
that higher education in Sweden is free; there are no fees
at all for the students.
major impact on the results, especially when a single programme is studied. In the region, short time fluctuations in
the demand for nurses have been observed, mainly because
of resource bottlenecks in the public care system. Health
care in Sweden is mainly publicly provided and the labour
market conditions for nurses are generally seen as very
good, at least in the longer run (see e.g., Arbetsmarknadsstyrelsen, 2001; 2005). Municipalities and county councils
employed most of the students on both programmes.
The students
The labour market entry
People from all regions in Sweden were allowed to apply.
However, the majority of the applicants were settled in
the region. The students were enrolled in 2002 and examined in 2005. A similar nursing programme was provided
on-campus by the same department of nursing, such that
the student group on the net-based programme can be
compared to the corresponding on-campus programme.
This is important in order to study the characteristics of
the students. A previous study concludes that the nursing programme was able to attract a new student group
(Fåhraeus and Lundberg, 2002). The study indicated
that the students were older compared to the on-campus
programme and were also more likely to have family and
children.
Some differences between the net-based programme and
the on-campus programme can be observed. Students
on the net-based programme applied for 1.7 positions
on average and 42 percent had a temporary position.
Students on the on-campus programme applied for 5.7
positions on average and 63 percent had a temporary
position. Some differences in labour market outcomes
were observed between the net-based programme and
the on-campus programme. At the time of graduation,
10 percent of the on-campus students were employed
compared to 65 percent for the net-based programme.
The corresponding figures after one year were 89 and 93
percent, a much smaller difference. One important question is whether these differences were due to the selection
of students or treatment effects. It is reasonable to believe
that it is foremost an effect of student selection and different conditions in the labour market.
The net-based nursing programme
The nursing programme extended over three years. Students had practical sessions at a clinical training centre and
a final practical at a hospital. The students on the net-based
programme were equipped with laptops, cameras, technical support, etc. This equipment and the investment in the
clinical training centre generated the additional costs compared to the on-campus programme. Without discussing
the quality of the training thoroughly we refer to the study
by Lundberg (2005) that argues that the students felt that
there were no quality differences between the on-campus
programme and the net-based programme. Quality was
for example measured as teacher accessibility.
Workplace after exam
The actual workplace after graduation corresponds to a
large extent to a previous study where the students reported their preference for workplace after graduation
(see Fåhraeus and Lundberg, 2002). The results indicate
that Academy North succeeded in its intention to encourage local students not to migrate after graduation.
Almost all students remained within the region after
graduation. The results also indicate that students from
the on-campus programme were not interested in working in the Academy North region. Thus, the net-based
nursing programme had a positive effect on the recruitment of nurses to this region. This is a very important observation since migration is the key factor in the regional
cost-benefit analysis, i.e. to what extent the municipalities find their investment beneficial.
The labour market
Since the cost-benefit analysis is concerned with the effect of education, the labour market conditions may have a
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The alternative case for the cost-benefit
analysis
Results
The time scale of the analysis is between 2002 (programme
start) and the year when the individual turns 65. Present
values of costs and benefits are calculated using discount
rates between two and six percent. For discount rates within a reasonable interval (2 - 6 percent) the net present value
for the regional analysis is positive. However, the national
analysis that considers all costs gives a negative net present
value for higher discount rate (4 - 6 percent). The results
from the case study clearly indicate that from the municipality’s point of view, their investment is beneficial for the
region and the funding from the state is merely a regional
support. The project is less beneficial for the state, which
is natural since they consider all costs in the analysis, and
given the benefits that are included.
What factors are important for the result? Firstly, student performance is obviously important. The results are
sensitive to changes in student performance. Programmes
with few students are therefore more vulnerable. Secondly,
labour market outcomes and labour market conditions obviously are important; the lack of nurses in the region is
the main objective for starting the programme. The most
important factor for the regional analysis is migration; if
students move away after the final exams, the regional benefit is lost. However, for the national analysis, the result is
not dependent upon migration within Sweden as long as
the regional dimension is not considered.
A majority of the students reported that the on-campus
programme was not an option. This is also an important
observation as it indicates that the net-based programme
actually attracted a new student group. It also indicates that
the relevant alternative case is when students do not attend
the programme on-campus and continue the occupation
they had prior to the period of study.
Benefits
We have discussed the main benefits from the programme
in the context of a cost-benefit analysis. The wage one
year after exams has been used as an approximation of the
production value. We have assumed that there is no future
productivity increases (or more specifically that they are
outweighed by productivity increases in the alternative
case). Other benefits that are not measured as monetary
values but that may be important in a sensitivity analysis
are e.g. student satisfaction from education, higher ability
or new competence of teachers, and regional spill-overs
from less out-migration. The benefits included may thus
be seen as a minimum level of benefits.
Costs
4. Discussion
The main cost is the production loss that arises when students choose to study instead of continuing their occupation. The production loss is estimated using the income for
the occupation prior to the education that is reported in the
survey. The Department of Nursing provided the data on
costs for the net-based nursing programme, e.g. resources
associated with teachers, goods and services, inventories
and premises. As mentioned before, it is important to note
that the figures that appear in the budget are not the true
alternative costs. However, it is reasonable to assume that
these figures represent the value of the resources in the alternative case.
Costs were defined as development costs, direct costs,
and administrative costs. The costs were significantly higher
on the net-based programme compared to the on-campus
programme. The costs that were added compared to the
on-campus programme, were financed by the municipalities (Academy North).
This short paper has briefly discussed e-learning in the
context of social cost-benefit analysis. A short summary
of a case study concerning a net-based nursing programme
has also been presented. A main purpose of the paper is to
discuss e-learning as a potential regional policy tool. The
results from the case study indicate that e-learning may be
used successfully to achieve regional goals, e.g. to mitigate
a lack of a specific competence in the labour market. The
results also indicate that it is important to consider different incentive structures since they affect the willingness to
provide or fund investment in e-learning. Several major effects that are important for social-cost benefit analysis have
not been estimated. For example, what is the benefit to an
from higher education and the option to stay in the home
region? What is the benefit of having nurses and health
care in the region? And are there regional spill-overs? As a
consequence, the benefits of the investment are most likely
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to be greater than we have estimated. This kind of case
study raises some important questions on whether it is a
good policy to combine regional policies and education
policies. Can this kind of policy combination be efficient
in fulfilling the EU policy goals of regional cohesion?
eliasson, kent (2006). “The Effects of Accessibility to
University Education on Enrolment Decisions, Geographical Mobility, and Social Recruitment. College
Choice and Earnings Among University Graduates in
Sweden”. Ph.D. dissertation. Umeå University.
fåhraeus, maria; lundberg, sofia (2002). “Hur gick
det till? En utvärdering av Sjuksköterskeprogrammet i Lycksele. En sjuksköterskeutbildning med IToch Glesbygdsprofil”. CERUM Working Paper. No.
54:2002.
hultkrantz, lars; nilsson, jan-eric (2004). Samhällsekonomisk analys. Stockholm: SNS Förlag.
glaister, stephen; layard, richard g. (1994). CostBenefit Analysis. Cambridge: Cambridge University
Press.
länsarbetsnämnden västerbotten (2004). Västerbottens län. Arbetsmarknadsutsikterna hösten 2004
– årsskiftet 2005/2006.
lundberg, johan (2007). Do Online Students Perform
Better than Face-to-face Students? A Short Review
of Some Empirical Findings [mimeo]. CERUM,
Umeå University.
lundberg, sofia (2005). “Klara, färdiga, vårda! En utvärdering av det nätbaserade sjuksköterskeprogrammet
i Lycksele”. CERUM Working Paper. No. 83:2005.
Proposition 2001/02:4. En politik för tillväxt och
livskraft i hela landet. Proposition 2001/02:15. Den
öppna högskolan.
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axelsson, roger; löfgren, karl-gustaf (1992). “Arbetsmarknadsutbildningens privat-och samhällsekonomiska effekter”. EFA rapport. No. 25.
brent, robert j. (2006). Applied Cost Benefit Analysis.
Cheltenham: Edward Elgar Publishing.
brown, byron, b.; liedholm, carl, e. (2002). “Can Web
Courses Replace the Classroom in Principles of Microeconomics?” American Economic Review. No. 92,
pp. 444-448.
coates, dennis; humphreys, brad; kane, john;
vachris, michelle, a. (2004). “«No Significant Distance» between Face-to-face and Online Instruction:
Evidence from Principles of Economics”. Economics of
Education Review. Vol. 23, No. 5, pp. 533-546.
Recommended citation
hanes, niklas; lundberg, sofia (2008). “E-learning as a Regional Policy Tool: Principles for a Cost-benefit
Analysis”. In: “The Economics of E-learning” [online monograph]. Revista de Universidad y Sociedad del Conocimiento
(RUSC). Vol. 5, no. 1. UOC. [Accessed: dd/mm/yy].
<http://www.uoc.edu/rusc/5/1/dt/eng/hanes_lundberg.pdf>
issn 1698-580X
This work is subject to a Creative Commons Attribution-Noncommercial-NoDerivativeWorks 2.5 Spain licence. It
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E-learning as a Regional Policy Tool: Principles for a Cost-benefit Analysis
About the authors
Niklas Hanes
Assistant Professor at the Department of Economics at Umeå University
[email protected]
Dr. Niklas Hanes, PhD in economics, works as an Assistant Professor at the Department of Economics at
Umeå University. He has worked with research projects concerning efficiency in the public sector and especially
interdependencies in economic federations, and labour and education economics, mainly focused on non-cognitive
skills and their effect on labour market behaviour and wage premiums. In 2004 he was contracted by the National
Agency for Higher Education in Sweden to analyse the economic effects of an extended academic year. He
participates in the European eLene-EE project on the economics of e-learning.www1
Sofia Lundberg
Assistant Professor at the Centre for Regional Science at Umeå University
[email protected]
Dr. Sofia Lundberg holds a position as Assistant Professor at the Centre for Regional Science at Umeå University.
She has a PhD in economics and has been working at the centre since 2001. She works with research and education
in the field of regional economics. She is the project manager of the Evaluation of net-based education in nursing
project which deals with questions like “Why a netbased nursing programme in Lycksele?” and “How was it done?”
She also works with evaluation of student collateral and student–student / teacher–student communication. She
participates in the European eLene-EE project on the economics of e-learning.www1
[www1] http://www.elene-ee.net/
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Monograph “The Economics of E-learning”
article
E-learning and Labour Market:
Wage-premium Analysis
David Castillo-Merino, PhD
Jordi Vilaseca-Requena, PhD
Enric Serradell-López
Natàlia Valls-Ruiz
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
The link between ICT and the demand for high-skilled labour is due to the fact that the introduction of digital
technologies alters the skill requirements of occupations in three main ways (Spitz, 2003): 1) ICT capital substitutes repetitive manual and repetitive cognitive activities, 2) ICT capital is complementary to analytic and interactive activities, and 3) ICT capital increases the requirement for computing skills. Within this framework, we have
analysed the determinants of labour productivity of individuals that have taken higher education programmes
online to test how occupational skill requirements and the degree of ICT adoption by the industry matches skills
of online students. In order to do this, we have assumed an implicit relationship between education and ability
(Griliches and Mason, 1972), recognizing that online students may acquire specific skills, such as computing skills
and abilities related to ICT use. For the empirical analysis we have used a database of degree students from the
UOC (Universitat Oberta de Catalunya). The results from our model based on Mincerian equations show three
important facts: 1) schooling is not a significant variable to explain wage differentials; 2) experience, understood
as previous productivity and production losses avoided, is the most important variable explaining improvement of
wages; and 3) ICT skills have a positive and significant effect on wage levels.
Keywords
e-learning, labour market, wages, labour productivity, ICT skills
JEL Classification: D61, I21, I22, I28
E-learning y mercado de trabajo: Análisis de primas salariales
Resumen
El vínculo entre las TCI y la demanda de personal altamente calificado se debe a que la introducción de las tecnologías
digitales altera los requisitos de calificación de los puestos de trabajo de tres formas principales (Spitz, 2003): 1) el capital
de las TIC sustituye actividades manuales y cognitivas repetitivas, 2) el capital de las TIC complementa las actividades
analíticas e interactivas, y 3) el capital de las TIC aumenta los requisitos en cuanto a destrezas informáticas. En este marco,
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E-learning and Labour Market: Wage-premium Analysis
hemos analizado los determinantes de la productividad laboral de personas que han seguido programas de educación superior por
Internet para comprobar de qué forma los requisitos de capacidades ocupacionales y el grado de aplicación de las TIC por la industria
se corresponden con las capacidades de las personas que han seguido cursos por Internet. Para llevar a cabo este análisis, hemos
asumido que existe una relación implícita entre la educación y la capacidad (Griliches y Mason, 1972) reconociendo que las personas
que han seguido cursos por Internet pueden adquirir habilidades específicas, como destrezas informáticas y habilidades relacionadas
con el uso de las TIC. Para el análisis empírico, hemos usado una base de datos de estudiantes diplomados por la UOC. Los resultados
de nuestro modelo basado en ecuaciones de tipo minceriano muestran tres hechos importantes: 1) la educación no es una variable
significativa para explicar las diferencias salariales; 2) la experiencia, entendida como productividad previa y elusión de pérdidas de
producción, es la variable más importante para explicar las mejoras salariales; y 3) las destrezas de uso de las TIC tienen un efecto
positivo y significativo en los rangos salariales.
Palabras clave
e-learning, mercado de trabajo, salarios, productividad laboral, destrezas en el uso de las TIC
1. Introduction
of individuals’ background characteristics on occupational
attainment and income have indicated that, while much of
the variance remains unexplained, the most important single indicator is education. Indeed, it has also been proven
that a virtuous circle arises within the complementary relations between education and income, so that education can
explain higher earnings for workers while higher income
causes increases in the demand for education (Sianesi and
Van Reenen, 2002).
Other individual benefits from higher levels of education, directly related and complementary to wages, are 1)
the higher likelihood of participating in the labour market
and 2) the lower of being unemployed. Participation in the
labour market and unemployment rates are closely related
to education (OECD, 1997 and 1998; de la Fuente, 2003)
and help to explain the economic benefits for individuals.
An important concern is that benefits of educational
investments for individuals extend beyond increases in earnings and employment conditions to other factors that have
an indirect effect on economic benefits. In this sense, education has a positive impact, among other factors, on health
(Taubman and Rosen, 1982; Desai, 1987), on intergenerational cognitive development (Angrist and Lavy, 1996;
Lam and Dureya, 1999), on developing more rational organizational and financial competence, and better analytical
skills (Lassibille and Navarro Gómez, 2004), on increasing
the likelihood of participating in politics and social decision
mechanisms (Campbell et al., 1976), on adopting a better
International literature provides clear empirical evidence
that education leads to major benefits, both for individuals and for society as a whole. In economic terms, human
capital accumulation as a result of the educational process must be considered a mixed good, i.e. a private good
with positive public externalities. The nature of educational
goods leads to the distinction between private and social
educational benefits.
From the private benefits point of view, and following
human capital theory approach, the increase in individuals’ level of educational attainment is consistent with an
increase in their productivity in the labour market, which
explains higher wages for more educated workers. Since
Mincer (1974), who estimated that individuals’ schooling
accounted for around 10% of wage increases in the USA, to
today, a large amount of empirical evidence1 demonstrates
a high positive correlation between individuals’ educational
levels and wages. Therefore, taking into account age and
experience, better-educated workers earn more than their
less-educated peers (Cipollone, 1995). However, education
is not the only explanatory variable of wage differentials.
There are other variables, sometimes difficult to measure,
that affect labour market outcomes: individuals’ innate
ability, social and economic status, family background
and other social factors. But, as pointed out by Hinchliffe
(1995), earnings functions and path analysis of the effects
1. Some recent contributions to this field are: DE LA FUENTE (2003), HARMON, WALKER and WESTERGAARD (2001) CARD (2001),
ASHENFELTER, HARMON and OOSTERBECK (1999), LASSIBILLE and NAVARRO GÓMEZ (1998), OECD (1998) or PSACHAROPOULOS (1994).
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E-learning and Labour Market: Wage-premium Analysis
consumption technology and a greater efficiency in making
consumption choices (Rizzo and Zeckhauser, 1992) and on
higher saving rates (Solomon, 1975). All these additional
advantages are real benefits from education but they are difficult to measure in monetary terms.
From a social point of view, education plays an important role in determining the level and the distribution of
income, in productivity and in economic growth of firms
(and institutions in general).
Firms and institutions benefit from having more educated employees at their disposal through two main channels: 1) through the positive effect of education and training on the improvement of productivity levels and rates
of growth (Dearden et al., 2000; Bresnahan, Brynjolfsson
and Hitt, 2002), and 2) through the spill-over effects
from better-educated workers. Therefore, the incidence of
higher levels of educational attainment is shown not only
in the higher productivity of educated workers, but also
in the increase in productivity of other workers as a result
of learning by imitation and improving their skills from
working with them (London Economics, 2005).
For the society as a whole, the empirical evidence suggests that there is a positive relationship between education
(through human capital formation mechanisms) and economic growth (Lucas, 1988; Romer, 1990; de la Fuente and
Ciccone, 2002; Jorgenson, Ho and Stiroh, 2005), particularly
when technological change is considered (Psacharopoulos and
Patrinos, 2004). These economic benefit estimations are usually based on gross wages across the economy and on the fiscal
incomes derived from economic growth of the industry.
There are also other social benefits that indirectly affect performance of economies through different channels.
Education produces external effects that have a positive
impact on agents other than those benefiting from it. These
externalities, such as social cohesion, political stability, or
citizen participation on public policy issues, are difficult
to identify and, especially, to measure. Nevertheless, some
authors have tried to identify and quantify educational externalities (Weisbrod, 1964; Havenam and Wolfe, 1984;
Heckman and Klenow, 1997; McMahon, 2000; Acemoglu
and Angrist, 2000; or Davies, 2002) by three major methods: 1) consumer surplus or welfare improvements, 2) expenditure on related private goods, and 3) hedonic pricing
models. The results of these studies show that the measure
of social spill-overs explains the existence of significant
higher returns to investment in education for societies. In
fact, the most plausible sources of these externalities are
the link between human capital and the rate of technological change, and the indirect effect of education on productivity and employment through the quality of institutions
that may be considered a component of social capital (de la
Fuente and Ciccone, 2002).
In addition, the increase of individual and social human
capital acquired through e-learning provision and e-learning contribution to develop workers’ e-skills may help to
reduce skill-biased technological change effects on wages
distribution in labour markets.
2. Costs and benefits from education
Costs and benefits can be combined in several ways for a
cost-benefit analysis. The most common methods are rates
of return, cost-benefit (and benefit-cost) ratios and net
present values. The estimation of internal rates of return
on investment, i.e. the interest rate that equates the present
values of benefits and costs (Psacharopoulos and Woodhall, 1985), captures the complete picture of the costs and
benefits of education and, therefore, it demonstrates which
forms of investment produce the best value for money.
The rate of return to investment in education is a
measure of the future net economic payoff to an individual
or society of increasing the amount of education offered
(Carnoy, 1995). It is calculated by setting the discounted
value of costs (Ci) and benefits (Bi) over time equal to zero
and solving for the implicit discount rate r:
∑
=∑
Ct
(1 + r )
(1 + r )
(1)
Private rates of return for individuals and rates of return for society are estimated, in which private benefits are
added to those accruing to firms and society, and private
costs are also added to costs incurred by firms and society
(table 3).
From the standpoint of the individual, to estimate the
private rates of return, private costs and benefits must be
computed. The benefits of additional education are the
additional income the individual earns as a result, the
non-economic consumption benefits that educational investment provides over a person’s life, and the direct consumption benefits derived from the educational process.
However, in measuring private rates of return, economists
have limited themselves to the earnings benefits of education (Carnoy, 1995).
From the standpoint of society, social costs and benefits
must be estimated. Social benefits are usually estimated by
using the same average earnings streams as in the private
rates of return calculation, corrected for income taxes.
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E-learning and Labour Market: Wage-premium Analysis
Therefore, in order to analyse the economic return effects from education investment, two different types of
discount rates must be estimated:
1) The private rate of return to education (rp) through the
discounted value of private costs (PC) and benefits (PB):
∑
PBt
(1 + r )
t
=∑
PC t
SBt
(1 + rs )
t
=∑
SC t
(1 + rs )
t
(3)
Where:
SB = PB + UB UB = Benefits accruied by firms and
society.
(1 + r )
t
(2)
2) The social rate of return to education (rs), defined as
the relation between social costs (SC) and benefits (SB):
p
∑
p
SC = PC + UC ; UC = Costs incurred by firms and
society.
Table 1. Rates of return to education
Rates of return to education
Private benefits
+
Benefits to firms and society
=
–
Private costs
Social benefits
-
+
Costs by firms and society
=
Social costs
=
=
Private rate of return
Social rate of return
Source: London Economics (2005)
3. Estimating the returns to
education. Theoretical models
sical specification used to estimate the effect of individual schooling on wages has been the following (Mincer,
1974):
ln Wi = α + θ Si + γ Ei + µ Ei2 + ϕ X i + ui There are two principal methods used in estimating rates
of return to education: the “traditional method” and the
“Mincer method”.
The traditional method takes into account calculated
annual costs and earnings by education level. To estimate
private returns to education direct and indirect costs carried by individuals are added to opportunity costs (earnings foregone). And these are added to public costs to
estimate annual social costs for the social rate of return.
Annual private and social benefits are calculated from the
difference in average earnings of those who have different
levels of education. For the private rate income differences
are estimated using net values, but for the social rate gross
income figures are used. These annual costs and benefits
are inserted into equation (1) to estimate the discount rate
that makes costs and benefits equal.
The Mincer method uses regression analysis to fit a
Mincerian human capital earnings function. The clas-
Where W is the wage (earnings), S the years of schooling, E the experience, X a set of individual characteristics,
and u the variation in log-wages not captured by the computed variables. The parameter θ measures the percentage increase in wages associated with an additional year
of schooling. Under certain conditions (which include the
assumption that there are no direct costs of education) θ
can be interpreted as the private rate of return to schooling.
This is why θ is known as the Mincerian return to schooling
and also as the schooling wage-premium or as the gross
return to schooling (de la Fuente and Ciccone, 2002).
The reasoning behind this calculation is that partial
differentiation of lnW with respect to S gives a method
of the calculation of rates of return (Carnoy, 1995), in a
continuous form:
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E-learning and Labour Market: Wage-premium Analysis
θ=
δ ln W
δS
Where Ws and W0 refer to the earnings of those individuals with s and 0 years of schooling, respectively.
Therefore, marginal rates of return to particular levels
of education can be estimated from Mincerian regressions
by substituting a string of dummy variables for each level
of schooling.
Rates of return have been estimated for a large number
of countries, by types and levels of education, by gender,
and, for some countries, over time (Psacharopoulos and
Patrinos, 2004).
(5)
And also in discrete form:
θ=
ln W s − ln W0
∆S
(6)
Table 2. Returns to investment in education by level, full method, regional averages (%), 2003
Social
Region
Primary
Secondary
Private
Higher
Primary
Secondary
Higher
Asia*
16.2
11.1
11.0
20.0
15.8
18.2
Europe/Middle East/North Africa*
15.6
9.7
9.9
13.8
13.6
18.8
Latin America/Caribbean
17.4
12.9
12.3
26.6
17.0
19.5
OECD
8.5
9.4
8.5
13.4
11.3
11.6
Sub-Saharan Africa
25.4
18.4
11.3
37.6
24.6
27.8
World
18.9
13.1
10.8
26.6
17.0
19.0
* Non-OECD
Source: Psacharopoulos and Patrinos (2004)
Figure 1. Social returns to investment in education by income level
Source: Psacharopoulos and Patrinos (2004)
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E-learning and Labour Market: Wage-premium Analysis
The return to education is negatively related with the
level of economic development of the country. This relation
can be seen at all education levels (primary, secondary and
higher education) but is most observable in the primary and
secondary levels of education. Nevertheless, the major return
to education of the primary and secondary education is a
common pattern over time and across the countries. Indeed
the classical pattern of falling returns to education by level
of economic development and level of education are maintained (Psacharopoulos and Patrinos, 2004).
tive cognitive activities, 2) ICT capital is complementary
to analytic and interactive activities, and 3) ICT capital
increases the requirement for computing skills. This relationship underlies the evidence that, compared to previous
technological revolutions (that aimed to routinize manual
tasks), digital technologies are also capable of taking over
simple human cognition tasks such as perceiving, choosing
and manipulating processes, and searching and managing information; and in addition computer technologies
are complementary to analytical and interactive activities.
There is also evidence that ICT capital does not substitute
whole occupations, but that it is limited to some tasks. This
limited substitution relationship, pointed out by Bresnahan
(1999) shifts the demand for labour towards workers with
higher levels of education who are considered to have a
comparative advantage in performing analytical and interactive tasks. Thus, computer technologies shift the relative
skills requirements of occupations towards analytical and
interactive activities.
From the private benefits point of view, and following
human capital theory approach, the increase of individuals’ level of educational attainment is consistent with an
increase of their productivity in the labour market, which
explains higher wages for more educated workers.
Moreover, there is a relation between the labour market experience, major education attainment and higher
earnings. As we can see in the table below, 10 years of
experience in the labour market increase real earnings
by approximately 16% for employees with less than upper secondary education, 30% for employees with upper
secondary education and 40% for employees with tertiary
education. These data make it evident that earnings grow
with experience significantly faster for the more educates
employees than for the less educated.
To determine differences in wages between individuals
that have followed higher education programmes through
online methodology it is useful to test how occupational
skill requirements and the degree of ICT adoption by industry matches online students’ skills.
In order to do this, it is necessary to assume an implicit
relationship between education and ability (Griliches and
Mason, 1972), recognizing the fact that online students
may acquire specific skills. In particular, it is assumed that
online students should attain higher computing skills and
more abilities related to ICT use, such as knowledge transmission by digital devices, information management, selfprogramming and continuous learning abilities (Levin et
al., 1987).
Data from Spitz’s work IT Capital, Job Content and Educational Attainment (2003) allow us to see some changes, and
4. Education and wages: the role
of ICT in the relationship between
e-learning and labour productivity
From a labour economics point of view, published theories and empirical findings demonstrate that technological
change has a significant impact on the labour market. This
topic has been an important concern of economic research,
and the discussion has intensified in the two last decades
due to generalized adoption of ICT in the economic sphere
(Spitz, 2003). A key observation in this field is that highly
skilled workers, and especially those with higher levels of
educational attainment, are more likely to use computers in
their jobs (Krueger, 1993). These facts have led to the important consensus in the labour economics literature that
a burst of new technology causes a rise in the demand for
highly skilled workers, which in turn implies an increase in
the wages of skilled workers relative to unskilled workers.
This hypothesis is known as the Skill-Biased Technological Change (Acemoglu, 2002; Acemoglu, 1998).
In this sense, some research (Berndt et al., 1992; Berman et al., 1994; Kaiser, 2000) shows that, over the last
few decades, this has been during a structural shift towards
the increase in deployment of white-collar work in most
sectors of developed economies and a rise in employment
of workers with high levels of formal education. Moreover,
other studies (Wolff, 2000; Autor et al., 2001) have found
that the changing in employment patterns resulted in an
upgrading of cognitive and interactive skills and a decreasing demand for manual skills. This evidence is simultaneous with the increase of ICT investment and extent to
which firms adopt ICT. The link between ICT and the
demand for high-skilled labour is due to the fact that the
introduction of digital technologies alters the skill requirements of occupations in three main ways (Spitz, 2003):
1) ICT capital substitutes repetitive manual and repetirusc vol. 5 n.º 1 (2008) | issn 1698-580x
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E-learning and Labour Market: Wage-premium Analysis
new trends in the skills requirement along the period from
1979 to 1999. The data describe an increase in the average
proportion of interactive skills in the work of all occupational
categories (all the occupational groups increase the interactive tasks more than 50 %). Furthermore, professional, tech-
nical and clerical workers realize less analytic tasks than in
1979 in contrast to production operatives and craft workers
who carry out more analytic tasks in their occupations. This
trend may be partially due to the increase in education for
the production operatives and craft workers.
Table 3. Trends in aggregate skills requirements (workers between 15-65 years old in West Germany and of German nationality)
Analytic skills
Interactive skills
Repetitive
cognitive
Repetitive
manual
Non-repetitive
manual skills
Computer skills
1979
12.8
11.5
15.2
10.9
49.2
0.3
1985/86
10.0
23.8
16.7
18.8
27.9
2.8
1991/92
8.3
23.6
15.3
11.4
36.1
5.3
1998/99
15.2
63.7
3.0
2.1
11.0
5.0
Source: Spitz (2003)
The repetitive and the non-repetitive manual skills
requirements decreased significantly over the two decades in all the occupational groups, even among the
operatives and craft workers. There was a progressive
increase in pc-skills requirement in all the occupational
groups during this the period. Clerical workers are the
occupational group that use their pc-skills more intensively..
Table 4. Distribution of task intensities by educational groups (workers between 15-65 years old in West Germany and of German
Nationality)
Analytic skills
Interactive skills
Repetitive
cognitive
Repetitive
manual
Non-repetitive
manual skills
Computer skills
High level of
education
19.1
53.6
12.1
2.0
8.3
5.0
Medium level of
education
11.4
28.4
13.3
10.9
32.5
3.4
Low level of
education
8.0
23.2
10.0
15.9
41.4
1.5
Source: Spitz (2003)
5. E-learning skills and
productivity: the case of UOC’s
degree students
• Experience, understood as production losses avoided,
is a critical factor in explaining wage improvement for
online graduates.
• ICT skills have a positive and significant effect on labour productivity (wages) as firms value the interactive
and analytical abilities beyond ICT uses at the place of
work.
Within the Skill-Biased Technological Change framework, we aim to verify two interesting points:
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E-learning and Labour Market: Wage-premium Analysis
According to the theoretical framework, it is feasible
to identify some critical sets of variables in the explanation
of online degree students’ wages. We have divided these
variables into three categories:
1. The usual variables in wage analysis, based on individual’s traits (sex, age, parenthood and economic position at
home) and on schooling.
2. An additional set of variables based on the individual’s position at work: the kind of job and the existence of
flexitime at work.
3. Some variables reflecting individual’s ICT skills and
professional-ICT based skills.
Table 5. Dependent, independent and control variables in Mincerian regressions
Dependent variable
Measures
Characteristics
Individual earnings
Wages
Gross annual earnings in current euros
Numerical
Explanatory variables
Measures
Characteristics
Individual characteristics, Schooling, Experience, Labour relations, Labour category, Professional skills, ICT skills
Sex
1= Male
2 = Female
Binary
Age
Age at time of graduation
Numerical
Children
Having children
Number of children
Binary
Numerical
Economic position at home
Main income provider = 1
Not main income provider = 0
Binary
Schooling
Number of years studying before starting at UOC
Numerical
Experience
Number of years holding a job
Numerical
Kind of work
Entrepreneur = 1
Worker = 0
Binary
Flexitime at work
Full time worker = 1
Part time worker = 0
Binary
Professional ICT-based skills
Technical knowledge, continuous learning, self-programming, time
management, decision making, adaptability, communication, networking
Numerical (1,10)
ICT skills
Computers, software, Internet, data bases, Virtual communication
channels
Numerical (1,10)
Control variables
Measures
Characteristics
Place living, Economic sector, Undergraduate programme, Motivation of education, ICT in industries
Place living
Economic sector
Job categories
Type of labour contract
Kind of undergraduate programme
Motivation of education decision
ICT in industries
Barcelona = 1
Others = 0
Private sector = 1
Public sector = 0
Managers = 1
Others = 0
Dummy
Dummy
Fix = 1
Temporary = 0
Dummy
Improve at work = 1
Others = 0
Dummy
Economics, Computer Engineering, Laws = 1
Others = 0
Dummy
ICT users = 1
Not users = 0
Dummy
Source: authors
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E-learning and Labour Market: Wage-premium Analysis
We also used a database of degree students from the
UOC which has information on individuals’ wages and
skills, obtained through a survey conducted in 2005.
Our results show some interesting features:
• First of all, it is very important to comment that schooling, in which studies at UOC are included, is not a significant variable to explain the level of wages for degree
students after their investment in education.
• A second result that should be hightlighted is that
experience, understood as previous productivity and
production losses avoid, is the most important variable
explaining wages improvement for online degree students.
• A third notable result is that we have been able to
demonstrate that the more ICT skills are developed in
individuals, the more likelihood there is of increasing
labour productivity, measured through wages. We have
also found that soft skills related to ICT uses (technical knowledge, continuous learning, self-programming,
time management, decision making, adaptability, communication, networking) do not have a significant effect on wages improvement, showing a gap between
workers skills and labour needs in Catalan industries.
• In addition, we can affirm that there are some individual characteristics that have a positive and significant
impact in the explanation of wage differentials: married
men who are the main income providers are more likely
to have higher wages than the rest of the sample.
• Finally, from the labour market point of view, entrepreneurs have higher returns than workers, and within
this last category full-time workers in the private sector
receive higher wages than workers in the public sector
or part-time workers.
Table 6. Sample of UOC’s degree students
Undergraduate programme
Number
of
students
Business
544
Psychopedagogy
535
Laws
110
Computer Management Engineering
99
Computer Systems Engineering
135
Business Administration
424
Librarian Studies
294
Philosophy
83
Total sample
2,224
Source: authors
We have used Mincerian wage functions to analyse the
relationship between wages and the abovementioned set
of explanatory variables The results from the analysis show
that all the variables used in our model have a positive and
significant relation with degree students’ wages, except
schooling and professional ICT-based skills. Moreover,
we can also confirm that the explanatory variables we have
computed are useful to explain more than 60% of the differences in wages of degree students.
rusc vol. 5 n.º 1 (2008) | issn 1698-580x
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E-learning and Labour Market: Wage-premium Analysis
Table 7. Results. Wage analysis
Dependent variable: Wages after graduation
Method: Least squares
Included observations: 543
Variable
Coefficient
Std. error
T-statistic
Prob.
C
9.135596
0.110561
82.62944
0.0000
Sex
0.655371
0.027767
2.354242
0.0189
Civil status
0.094512
0.027396
3.449860
0.0006
Flexibility at work
0.312414
0.059494
5.251183
0.0000
Economic sector
0.087368
0.027110
3.222749
0.0013
Economic position home
0.125698
0.027681
4.541004
0.0000
Wages before graduation
2.05E-05
1.08E-06
19.00719
0.0000
Experience
0.019895
0.007084
2.808414
0.0052
Kind of work
0.88011
0.042752
2.058619
0.0400
Schooling
0.025385
0.070988
0.357592
0.7208
ICT skills
0.004042
0.001849
-2.186302
0.0292
Professional ICT skills 1
-0.017371
0.009939
-1.747742
0.0811
Professional ICT skills 2
0.005144
0.003835
1.341185
0.1804
Professional ICT skills 3
-0.005353
0.006578
-0.813769
0.4161
Motivation
0.099511
0.026550
3.748021
0.0002
R-squared
0.609250
Mean dependent var.
10.21674
Adjusted R-squared
0.598889
S.D. dependent var.
0.431083
S.E. of regression
0.273019
Akaike info criterion
0.268685
Sum squared resid
39.35681
Schwarz criterion
0.387390
Log likelihood
Durbin-Watson stat
-57.94810
2.061097
F-statistic
Prob. (F-statistic)
58.80333
0.000000
Source: authors
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E-learning and Labour Market: Wage-premium Analysis
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Recommended citation
castillo, david; vilaseca, jordi; serradell, enric; valls, natàlia (2008). “E-learning and Labour Market:
Wage-premium Analysis”. In: “The Economics of E-learning” [online monograph]. Revista de Universidad y
Sociedad del Conocimiento (RUSC). Vol. 5, no. 1. UOC. [Accessed: dd/mm/yy].
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rusc vol. 5 n.º 1 (2008) | issn 1698-580x
David Castillo-Merino, Jordi Vilaseca-Requena,
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E-learning and Labour Market: Wage-premium Analysis
About the authors
David Castillo-Merino
Assistant Lecturer at the Department of Economics and Business of the UOC.
[email protected]
Dr. David Castillo-Merino holds a position as Assistant Professor at the Department of Economics and Business
of the UOC. He is a member of the New Economy Observatory (IN3-UOC) research group. He is director of
Masters in the field of Corporate Finance. His research interests and areas of expertise include: the economics of
intangible assets, finance and innovation in firms, and e-learning and is an author of books and papers in these
areas. He participates in the European eLene-EE project on the economics of e-learning.www1
Jordi Vilaseca-Requena, PhD
Lecturer at the Department of Economics and Business of the UOC.
Dr. Jordi Vilaseca-Requena holds a position as Professor at the Department of Economics and Business of the
UOC. He is director of the New Economy Observatory (IN3-UOC) research group. His research interests are
focused on the knowledge economy, a field in which he has written several books and papers. He participates in the
European eLene-EE project on the economics of e-learning. www1
Enric Serradell-López
Assistant Lecturer at the Department of Economics and Business of the UOC.
[email protected]
Prof. Enric Serradell-López holds a position as Assistant Professor at the Department of Economics and Business
of the UOC. He is co-director of Masters courses in the field of Corporate Finance. His research interests and
areas of expertise include: corporate culture, the economics of intangible assets and e-learning. He participates in
the European eLene-EE project on the economics of e-learning. www1
Natàlia Valls-Ruiz
Assistant Professor at the Department of Economics of the University of Barcelona (UB).
Prof. Natàlia Valls-Ruiz is a financial analyst. She is also Assistant Professor at the Department of Economics of
the University of Barcelona (UB) and research assistant of the New Economy Observatory (IN3-UOC) research
group.
[www1] http://www.elene-ee.net/
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Monograph “The Economics of E-learning”
article
Do Online Students Perform Better
than Face-to-face Students?
Reflections and a Short Review of some
Empirical Findings
Johan Lundberg
David Castillo-Merino
Mounir Dahmani
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
The increases in the number of online courses given by universities have been quite dramatic over the last couple
of years. Nowadays, many universities even give complete degree programs online where instructions and lectures
in the form of, for example, streaming videos, are available for students to watch 24 hours a day. In a sense, the use
of Internet and Interactive Computer Technologies (ICT) in higher education can be compared to any other type
of teaching tool, such as the blackboard and overhead projectors. The motivation for using the Internet and ICT in
higher education, from an economic point of view, is if they are more effective as teaching tools compared to any
relevant alternative. That is, all else being equal, if the Internet is an effective teaching tool in that students who
attend online courses or complete degree programs perform better in terms of marks in the final exam compared
to face-to-face students. In this paper we reflect on and summarize some of the empirical findings in the literature
on the effects of online teaching on student performance compared to face-to-face equivalents.
Keywords
literature review, efficiency in higher education, student performance, ICT uses
¿Obtienen mejores resultados los estudiantes que siguen cursos por Internet que los
que siguen cursos presenciales? Reflexiones y breve revisión de algunos resultados
empíricos
Resumen
El aumento del número de cursos en línea impartidos por las universidades ha sido espectacular en los dos últimos años.
Hoy en día, muchas universidades ofrecen incluso programas de titulación completa por Internet. Los estudiantes cuentan
con acceso 24 horas a las instrucciones y los contenidos de las clases, p. ej., en formato de vídeo. En cierto modo, el uso de las
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Do Online Students Perform Better than Face-to-face Students?
TIC en la educación superior puede compararse con cualquier otro tipo de herramienta aplicada a la enseñanza, como la pizarra
o el proyector de transparencias. El argumento a favor del uso de Internet y las TIC en la educación superior, desde un punto de
vista económico, es que son más eficaces como herramientas aplicadas a la enseñanza en comparación con cualquier otra alternativa
relevante. Es decir, Internet será una herramienta de enseñanza eficaz si, en igualdad de condiciones, los estudiantes que siguen
cursos o programas de titulación completa impartidos por Internet obtienen mejores resultados en términos de calificaciones en los
exámenes finales que los estudiantes que siguen cursos presenciales. En este estudio comentamos y resumimos algunos de los resultados
empíricos disponibles en los estudios publicados acerca de los efectos de la enseñanza en línea sobre el rendimiento de los estudiantes
respecto a los estudiantes que siguen cursos presenciales.
Palabras clave
revisión de estudios publicados, eficacia en la educación superior, rendimiento de los estudiantes, usos de TIC
1. Introduction
of higher education. From the universities’ point of view,
online courses could be more cost-effective compared to
campus courses if it means that the university can teach
more students using the same or less resources compared
with an equivalent campus based course. For instance, if
the teacher can re-use materials such as streaming videos
of lectures several times it could decrease the teacher’s time
for preparation and realisation of the course the next time
the same course is given, meaning that both teachers and
universities save resources. However, in a study based on
nearly 4,000 students enrolled on introductory economics
at universities in the USA, Sosin et al. (2004) come to the
conclusion that there was no significant difference in time
spent between teachers who use a large amount of Interactive Computer Technology (ICT) in their teaching and
those who use none or only a small amount.
Moreover, the use of Internet and ICT in higher education could be a good pedagogical tool and hence save
time and resources for both students and teachers. In other
words, other things being equal, it could be that, for every
hour spent studying, a student who attends an online course
learns more than a student who takes the same course as an
ordinary, face-to-face, campus course. This would not only
save teachers’ time and university resources through the decreased number of re-examinations, but also student’s time.
What are the cons? All the pros of online courses could
of course be cons: if these courses do not tend to attract
more students (including students who would otherwise
not have undertaken a university education); if the preparation and realisation of the courses tend to consume more
resources than an ordinary campus course, etc. Even if not
all the pros are turned into cons, it might be the case that
the cons outweigh the pros, or vice-versa. Again, whatever
the result of such an evaluation, the final result is of interest
to policy makers as it would suggest whether online education should or should not be encouraged.
The Internet is about to cause a minor revolution within the,
in many other respects, conservative world of higher education. Not only has the Internet for some students outperformed university libraries as the main source for information and facts, it is also challenging face-to-face lectures as
a teaching tool. Today, stand alone online courses and complete degree programs are offered via the Internet by many
universities. Also virtual universities have appeared, giving
entire courses over the Internet, with some of them not even
having a campus and therefore no on-campus students. The
progress in this direction is going fast and it is probably not
possible, or even desirable, to stop. However, it is sometimes
wise to reflect, just for a moment or two, on the increased
supply of online courses in higher education. What are the
pros and cons of this development?
One of the advantages of online courses is the fact that
it is now possible to reach students who otherwise would
not, for different reasons, have undertaken university studies.
This could be due to practical reasons such as their family
situation not allowing them to move to a university town.
Or the individual might prefer to attend an online course or
a complete online based degree program as online courses in
many cases offer more flexible study hours. For example, a
student who has a job could attend the virtual class watching
instruction films and streaming videos of lectures after working hours, whenever they are. Hence, online courses make
it possible for students to live far from campus. Whatever
the reason, if online courses attract students who otherwise
would not have attended higher education, this is of importance from a policy perspective as it has a positive effect on
the accumulation of human capital.
Other potential pros of online courses relative to campus equivalents relate to the other actors, the providers
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Do Online Students Perform Better than Face-to-face Students?
The objective of this paper is not to validate all pros and
cons of online teaching in higher education and to come
up with the answer to whether online teaching, is from an
economic perspective, good or bad. Instead, we have a narrower perspective in that the main purpose of this paper is
to reflect on and summarise some of the existing empirical
knowledge regarding the most important determinants of
student success in university courses. In particular, we will
focus on the question of whether students who attend an
online-based course, where the Internet and ICT are used
to a high degree as a teaching tool, tend to perform better
or worse compared to students who attend ordinary, faceto-face and campus based courses, where the Internet and
ICT are used to a low degree, or not at all. The reflections
and reviews in this paper focus on studies based on quantitative analysis and regression models, preferably multiple
regression analysis. We will also try to distinguish between
different subjects. That is, is there any evidence suggesting
that online teaching and the use of Internet and ICT is
better suited for some courses or subjects than others?
As this literature is quite extensive, we do not claim or
suggest that our review covers all existing papers within
this field but instead we will summarize what we believe
to be the some of the most interesting findings. And even
though we focus on university courses, the overall discussions regarding the use of Internet and ICT as teaching
tools could to some extent also apply to other situations.
In what follows, online course or online education
will be used as a comprehensive term for Internet education and the use of ICT in higher education. In the same
manner, face-to-face education will be used for traditional
campus courses. The rest of this paper is organised as follows. In section 2 we discuss some methodological issues
that are of importance in the analysis of student performance. These include different measures of student performance, other potentially important determinants of student
performance and whether the course is given online or on
campus. This section also includes a short comment on
some econometric issues. Some empirical results are presented and discussed in section 3, and the conclusions are
in section 4.
to define the concept of student performance. How should
it be measured? In the economics literature, student performance is often measured as the student’s mark in a written test at the end of the course. In many cases, this mark
is only reported as pass or fail where fail corresponds to a
mark below the previously set level for pass. Even though,
in some cases, students are only interested in whether they
have failed or passed (or passed with distinction, a grade
often reported), which is also the information given in the
final certificate, this is a rather crude measure of student
performance, as the researcher can not distinguish between
students who have high marks and students who only just
pass. A more sophisticated analysis is of course possible if
the researcher can get access to the precise test score, which
will give them more information (see, among others Brown
and Liedholm, 2002). However, one important issue when
using test scores is that the researcher usually does not have
any information regarding the extent to which the test actually reflects the contents of the course.
Independent of which of these measures is used to capture student performance (test scores or fail/pass), one potential problem is that the researcher often does not have
information regarding the student’s previous knowledge.
Therefore, by only using test scores, the researcher does not
have any information on whether the student has gained
any knowledge during the course but only what level the
student has (or does not have) at the end of the course.
This problem could be overcome if student performance
is measured as the difference between the student’s previous knowledge and that at the end of the course, although
there are difficulties in collating this information. One relates to the design of the pre-course test in relation to the
post-course test (the final exam) as it would be problematic
to use exactly the same questions in both tests.
Another difficulty is that students may have objectives
other than just high scores in the written test. They might
just want to sit in during the lectures to enjoy the atmosphere, to socialise with friends who attend the same course
and lectures, or might be happy just to have been accepted
on the course. It could also be the case that the student
is applying for a job and taking a course rather than being unemployed, as being a student might look better for
potential employers. In this situation, the student might
actually not be interested in learning anything and hence
not pay attention, no matter what teaching tool is used. If
there are a number of students who are predetermined to
fail the final exam due to the reasons stated above, and this
is not controlled or corrected for in the empirical analysis,
this could give biased and inconsistent parameter estimates
which, in turn, could generate misleading conclusions.
2. Methodological issues
2.1. How to measure student performance
One of the more fundamental questions in analysing the
effect of a specific teaching tool on student performance is
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Do Online Students Perform Better than Face-to-face Students?
When it comes to comparisons of student performance across subjects and courses it is important to consider
that the form of the final exam sometimes differs between
subjects, and even across courses in the same subject. For
instance, introductory courses on economics are most typically examined through written exams at the end of the
course, while a combination of lab-reports and written
tests is frequently used in chemistry and electronics. Oral
examinations are sometimes used in linguistic courses, etc.
However, despite these drawbacks and difficulties, student
performance is most often measured in terms of grades or
marks in different tests during the course. One reason for
this is that this information is relatively easy to get hold
of. At the end of the course each teacher is, in most cases,
obliged to report whether students have failed or passed. It
is important to be aware of the weaknesses of the measures
of student performance frequently used when reading the
literature.
inconsistent parameter estimates. In the end, this would
cause misinterpretations of the parameter estimates and
their corresponding significance.
Firstly, in online courses, the Internet and ICT are used
as a substitute for the ordinary face-to-face teaching technique. However, if face-to-face teaching does not contribute to the learning of the students, then online teaching
and the use of Internet and ICT in higher education is
compared with something that does not contribute to the
learning of the students.
When it comes to student attendance in class and
their performance, the results are ambiguous. For instance,
controlling for student motivation, an issue we will return
to later on, Romer (1993) found that attendance did contribute to the academic performance of the students on a
macroeconomics course he taught in the autumn of 1990.
Similar results had previously been found for courses on
macroeconomics by Schmidt (1983) and also by Park and
Kerr (1990) for a money and banking course. These results
were later verified by, among others, Durden and Ellis
(1995).
However, contrary to these results, Brown et al. (1991)
did not find any evidence that a student who attended typically structured classes with lectures performed better on
the Test of Understanding College Economics (TUCE)
compared to students who attended a standard microeconomics principles course. What they did find was that
students who attended the lectures performed better on
essay questions than those who did not. In an early paper,
McConnell and Lamphear (1969) found no significant
difference in performance of students with and without
classroom attendance.
Motivation is often considered to be one of the most
important driving forces for people to reach their goals.
Some argue that motivation actually out-competes talent
when it comes to sports activities: It does not matter how
talented you are, if you do not have the right motivation,
you are deemed to be second. Even though this might be
the case, motivation is quite difficult to measure. It could
be reflected by the number of training hours (or, in our
case, the number of hours spent studying and/or in class),
but this is not necessarily a good measure. For instance, a
student could attend class because of being raised to be a
dutiful person, but not pay attention to what the teacher
has to say in class. Another possibility is to ask the students
how motivated they are. One problem with this method is,
of course, that the results will be highly subjective. Romer
(1993) used the number of non-compulsory problem sets
the student did during the course as a proxy for motivation:
the more non-compulsory problems sets, the more moti-
2.2. Other potentially important factors for
student success
The literature on the effects of online education on student performance is closely related to the more general
literature on important determinants of student success.
In a sense, online teaching could be seen as just another
teaching tool, and could actually be compared to the use
of the more traditional blackboard. For instance, if the use
of the blackboard does not contribute to the student’s ability to understand and assimilate the information provided
by the teacher, then the use of the blackboard should be
questioned. The same goes for the use of the Internet and
online teaching in higher education.
Hence, before we proceed and discuss the main issue
of this paper – the effects of online teaching on student
performance – let us discuss some other potentially important determinants of student performance used in the
literature. One of the reasons for doing this is to highlight
the fact that there are other factors likely to affect student
performance besides whether the student attends an online
or face-to-face course. We will not cover all these factors,
nor will we discuss their measurability – that would be beyond the scope of this paper – but just highlight that there
are other factors that matter for student success apart from
the course being online or at campus. However, the issue is
of importance from many perspectives, and maybe most so
from an econometric point of view, as the failure to include
relevant variables in the model could lead to biased and
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Do Online Students Perform Better than Face-to-face Students?
vated the student. Even though this is probably a reasonably good measure of motivation, it does still suffer from
the same drawbacks as the number of hours in class. The
argument has also been made that innovations in the use
of technology in higher education, such as the use of ICT,
actually could have a positive effect on motivation, attitude
and student performance (see Talley, 2005).
Student motivation and attendance relate to the factor,
often quoted in the literature, of how much time and concentration the student dedicates to other activities. Durden
and Ellis (1995) find a negative yet insignificant effect of
jobs on the side. Other studies have also used measures of
the number of hours spent on activities such as sports and
social activities. The effect of physical training could go either way, depending on how much time the student spends
on such activities. It could be argued that physical exercise
improves your ability to concentrate and should therefore
have a positive effect on student performance. On the other hand, the undertaking of too much physical exercise will
have a negative effect on the available time for studies, as a
day only has 24 hours, and it might also require spending
time on recovery and rest between training sessions.
As mentioned in the discussion of different definitions
of student performance, it is reasonable to assume that the
student’s previous knowledge will affect their ability to
pass the final exam. Pre-knowledge is typically measured
as previous college grades or previous experience in higher
education. For instance, Park and Kerr (1990), Anderson
et al. (1994), and Durden and Ellis (1995) find high preuniversity grades to have a positive effect on student performance. Roamer (1993) and Coates et al. (2004) find the
same positive effect of previous experience from university
studies on student performance.
Two other variables frequently used in this type of
studies are age (Anderson et al., 1994, and Coates et
al., 2004) and gender (see Durden and Ellis, 1995, and
Coates at al, 2004, just to name two). It could be argued
that age reflects maturity and hence should have a positive effect on performance, but it is also reasonable to assume that the ability to learn new things decreases with
age. Anderson et al. (1994) found a negative, decreasing
effect of age on student performance, while Coates et al.
(2004) found no effect at all. The effect of gender is rather
difficult to interpret as it is not reasonable to believe that,
for instance, men are more intelligent than women. Instead, gender is likely to capture differences in how we
are brought up and other social factors. Such effects are
probably also reflected by the different measures of race
used in the literature (see Brown and Liedholm, 2002,
and Coates et al., 2004).
Like students, teachers differ in several respects such as
personality, talent, and pedagogical skills, factors that are
likely to affect student performance, motivation, and attitude. In many studies on the effects of online teaching
on student performance, the same teacher is teaching both
the online and the face-to-face course, which should mean
that the teacher’s contribution to each individual student’s
attitude, motivation and performance is kept constant.
However, the very same teacher may actually perform and
act differently in different environments. For instance, the
teacher could be inexperienced in use of the Internet and
ICT which could have a significant effect on the ability to
contribute to the student’s learning.
Navarro (2000) addressed the issue of teacher performance in online versus face-to-face situations. Based
on interviews, formal discussions and questionnaires to
more than 100 teachers and instructors, Navarro comes
to the conclusion that a large majority of the teachers believed that they performed similarly or better in the online environment. If one believes that older students are
more motivated, a possible explanation for this result is
that the average age of the online students in this study
was higher than that of the face-to-face students. Navarro
also found that more motivated teachers tend to use ICT
and new teaching techniques to a larger extent than less
motivated teachers. Teachers also differ in their attitudes
towards adopting and introducing new teaching methods.
For instance, from a survey among academic members of
the American Economic Association (AEA) and teachers listed in the College Marketing Guide (CMG), Becker
and Watts (2001) conclude that teachers in economics are
quite reluctant to adopt new teaching methods. One explanation put forward by the authors is that the introduction
of new teaching techniques and ICT is associated with a
sunk cost, a cost that economics teachers are not willing to
accept. The results presented by Navarro (2000) support
the idea that the development of traditional face-to-face
lectures is more cost effective (less time consuming) for
teachers compared to online lectures.
There are of course also other student characteristics
and factors that could have a significant impact on their
performance, such as their family situation (for instance the
number of children), mental health status, etc. In a study
on the influence of different learning style preferences on
student success in online versus face-to-face environments,
Aragon et al. (2002) found that students can learn equally
well in either format, regardless of learning style, provided
that the course is developed around adult learning theory
using good instructional design guidelines. Unfortunately,
they do not make any formal analysis of significant differ-
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Do Online Students Perform Better than Face-to-face Students?
ences between online and face-to-face courses. The results
presented in the paper do not indicate that one learning
style has a significantly larger impact on, for instance, the
performance of online students as compared to face-toface students. However, that issue was beyond the scope
of their paper.
means that there is a group of students who actually would
have failed the exam but are not included in the sample.
Other reasons are that students realise that they have chosen the “wrong” course and/or that they have other interests.
If this is not accounted for in the empirical specification, it
could lead to an upward bias of the parameter estimates.
On the other hand, it is reasonable to assume that some
students never complete their studies because they get job
offers before the final exam. In contrast to the other reasons for dropping out, these students have a higher probability of passing the final exam and a failure to control for
this type of drop-outs will result in a downward bias of the
estimated parameters.
2.3. A short comment on some econometric
issues
The failure to use appropriate econometric tools and estimators in empirical analyses of phenomena such as student performance could result in biased and inconsistent
estimates, possibly leading to misleading inferences and,
eventually, misinterpretation of the results. There are at
least three econometric issues that need special attention.
The first is that of the factors that are regarded the most
important determinants for student success, one that is
considered to be endogenous, namely effort or the time the
student spends on studying. If, for instance, a student’s goal
is only to pass the course, and a new, very effective teaching tool is introduced, the student could actually spend less
time studying and still reach their goal.
Consequently, the time the students spend on studying is not determined outside the model and therefore the
econometric analysis should include instrumental variables. Even though the use of instrumental variables is now
standard in econometric software, the technique is nearly
exclusively used by economists.
The second issue relates to self-selection. That is, it
could actually be the case that a specific type of student
who tends to perform better than other students chooses
either campus or online courses. Coates et al. (2004) find
that failure to account for self-selection of students either
in face-to-face or online courses could lead to misinterpretation of the results. Their solution to the problem of
self-selection was the use of an endogenous switching
regression model. However, self-selection is only occasionally discussed and corrected for in the literature.
Becker et al. (1996) provide evidence that students with
higher levels of previous knowledge in the subject tend to be
more likely to continue on the course than those with lower
levels. In other words, those students who are less likely to
pass the final exam tend to drop-out before they do it, which
3. Some empirical results
So what does the literature tells us? The results presented
in a study by Brown and Liedholm (2002) based on 710
macroeconomics students in the USA suggest that campus
students tend to perform better compared to online students. Brown and Liedholm used test scores as the dependent variable and also control for gender, the students’ preknowledge in mathematics,1 and their high-school grades.
However, they do not control for factors such as the degree
to which the students attend class, if they work, if they are
engaged in other activities in their spare time, motivation,
age, or self-selection. Other important characteristics of the
students and their backgrounds are also lacking, Brown and
Liedholm’s results are supported by the findings by Coates
et al. (2004), who base their findings on 126 macroeconomics students in the USA. In contrast to Brown and Liedholm, these authors controlled for the students’ age which
could reflect motivation if we consider that older students
are more focused. They also controlled for how much the
students work besides their studies and use an endogenous
switching regression model to correct for self-selection.
Even though previous results based on economics students suggest that campus students tend to perform better compared with online students, these results are by no
means general for all courses and subjects. It is not even a
general result when it comes to economics. For instance,
Sosin et al. (2004) find the use of technological tools in
teaching economics at the introductory level to have a
positive effect on student performance. These results are
1. Good pre-knowledge in mathematics is often considered to be an important variable when it comes to learning economics. This is partly confirmed
by the results presented in Brown and Liedholm (2002) as their results suggest pre-knowledge in mathematics have a positive effect on the performance of campus students. However, no such effect was found for online students.
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based on a quite extensive data set of nearly 4,000 students
taught by 30 instructors across 15 different departments.
However, all these students attended campus courses, even
though the technological tools differ between the different
courses. Therefore, these results are not comparable with
other results presented in this review.
In another study on 345 computer science students, Dutton et al. (2002) found online students perform significantly
better compared to their peers who take the campus version
of the same course. One tempting explanation for this difference between economics and computer science students is
that those interested in computers tend to choose computer
science instead of economics, and if so, this result is driven
by self-selection. Dutton et al. also found that students who
take the online version of the course tend to be older, are
to a lower extent enrolled in traditional undergraduate programs, are more likely to have jobs and children and tend to
live further away from campus as compared to face-to-face
students. Hence, the online students have a greater need for
flexible studying hours. Among the students included in this
study, face-to-face students value the ability to get advice
from the lecturer as an important factor for choosing the
face-to-face version of the course. Moreover, the proportion
of drop-outs is higher within the group of online students.
Although this study provides many interesting results, the
potential problem of self-selection between the online and
face-to-face courses is not addressed, nor is the endogeneity
of study time and the fact that the proportion of drop-outs
is higher among those who choose the online version of the
course. The potential problem of self-selection can probably
not be ignored as the authors find prior computer experience to have a positive impact on the performance of online
students, and when this is controlled for in the model, the
significant difference in performance between online and
face-to-face students is reduced.
Hoskins and van Hoff (2005) analysed the effects of
the dialogue method via an online environment on student performance among 110 undergraduate psychology
students. They find the dialogue method to have a positive
effect on student performance. Again, however, the potential problem of self-selection is not properly addressed. As
the authors point out, the students who seize the opportunity to take part in this dialogue method tend to be more
motivated, and this group also differs from others when
it comes to age and gender. These factors, together with
the fact that they base their conclusions on differences in
mean values between this group of students and the rest,
make it difficult to compare these results with other results
based on multiple regression analysis where it is possible to
control for a number of different student characteristics.
Analysing student performance of 62 management
students in the USA, Neuhauser (2002) finds no significant difference in the mean value of test scores for online
versus face-to-face students. The potential problem of
self-selection is discussed but not controlled for. And even
though the author has information on gender, age, effectiveness of tasks and course effectiveness, this information
is not controlled for in the empirical analysis. Instead, only
mean values of the different characteristics of the separate
groups are compared.
4. Final reflections
Analyses of the dramatic increase in the number of online courses offered at universities are of importance from
many perspectives. One relates to the potential of online
education to attract new groups of students who would
otherwise not have undertaken university studies. If online courses attract these groups of students this is of importance as it will have an effect on the accumulation and
distribution of human capital. Another important issue is
the effect on student performance. If, all else being equal,
students who attend online courses tend to perform better compared to face-to-face students, this is an argument
for substituting face-to-face teaching for online teaching
techniques for campus students as well.
The main conclusion from this literature review is that
there is no general support of the hypothesis that online
students should perform better compared to face-to-face
students. Some studies, especially those based on economics students report the opposite result. Other studies report
results that support the hypothesis. This disparity in the
results of the studies can partly be explained by the fact
that the methodologies differ, making them non-comparable. Another possible explanation is that in the papers reviewed here, as well as in most papers reviewed elsewhere,
online teaching and face-to-face lectures are treated as a
homogeneous good, making no distinction regarding how
the Internet and ICT are used as teaching tools. Instead,
online teaching is assumed to be used in the same way independently of teachers, their characteristics and teaching
methods. To return to the comparison with the blackboard
made earlier in this paper, it would be the same as saying
it does not matter how you use the blackboard or what you
write on it during the lectures as long as you use it!
Although the papers presented in this review reveal
many interesting and important insights, the challenge
for future research is to combine the main contribu-
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Do Online Students Perform Better than Face-to-face Students?
tions from each of these studies. As in all quantitative
empirical research within the social sciences, data collection and the use of appropriate statistical methods are
crucial ingredients. For future research, we suggest the
following procedure: i) Collect data from many courses
and subjects. The number of students within each group
should be large; ii) Construct a measure which reflects
the knowledge gained during the course. This could be
based on the difference between the student’s pre-knowledge and final test scores; iii) Include all relevant explanatory variables such as motivation, time spent in lectures,
time spent on other activities, which could either distract
the student from studies or have a positive effect on the
ability to concentrate, as well as motivation, family situation, age, and gender. All student characteristics could
be collected through the use of a student diary where the
student reports all these activities during the course; iv)
Include teacher characteristics such as the teacher’s background, age, motivation, pre-skills in online and face-toface teaching; v) Include differences in teaching methods
used by the individual teachers; vi) Use appropriate estimators in order to minimise potential bias and inconsistency in the estimators; vii) Use instrumental variables to
handle the endogeneity of study time; viii) Correct for
self-selection; ix) Analyse and correct for drop-outs in
order to evaluate to what extent the drop-outs affect the
parameter estimates.
brown, w. b.; liedholm, c. e. (2002). “Teaching Microeconomic Principles – Can Web Courses Replace the
Classroom in Principles of Microeconomics?” American Economic Review Papers and Proceedings. May, pp.
444-448.
coates, d.; humphreys, b. r.; kane, j.; vachris, m. a.
(2004). “’No Significant Distance’ between Face-toface and Online Instruction: Evidence from Principles of Economics”. Economics of Education Review.
Vol. 23, no. 5, pp. 533-546.
durden, g. c.; ellis, l. v. (1995). “The Effects of Attendance on Student Learning in Principles of Economics”. American Economic Review Papers and Proceedings.
May, pp. 343-346.
dutton, j. d.; dutton, m.; perry, j. (2002). How do Online Students Differ from Lecture Students? JALN. Vol.
6, no. 1, July.
hoskins, s. l.; van hoff, j. c. (2005). “Motivation and
Ability: Which Students Use Online Learning and
What Influence Does it Have on their Achievement?”
British Journal of Educational Technology. Vol. 36, no.
2, pp. 177-192.
mcconnel, c. r.; lamphear, c. (1969). “Teaching Principles of Economics without Lectures”. Journal of Economic Education. Vol. 1, no. 4, pp. 20-32.
navarro, p. (2000). “Economics in the Cyber Classroom”.
Journal of Economic Perspectives. Vol. 14, no. 2, pp. 119132.
neuhauser, c. (2002). “Learning Style and Effectiveness
of Online and Face-to-face Instruction”. American
Journal of Distance Education. Vol. 16, no. 2, pp 99113.
park, k. h.; kerr, p. m. (1990). “Determinants of Academic Performance: A Multinomial Logit Approach”.
Journal of Economic Education. Vol. 21, no. 2, pp. 101111.
romer, d. (1993). “Do Students Go to Class? Should
They?” Journal of Economic Perspectives. Vol. 7, no. 3
(Summer 1993), pp. 167-175.
schmidt, r. m. (1983). “Who Maximizes What? A Study
in Student Time Allocation”. American Economic Review Papers and Proceedings. May, pp. 23-28.
sosin, k.; blecha, b. j.; agawal, r.; bartlett, r. l.; daniel, j. i. (2004). “Efficiency in the Use of Technology
in Economic Education: Some Preliminary Results”.
American Economic Review Papers and Proceedings.
May, pp. 253-258.
talley, d. (2005). Technology and Teaching: Learning in
High-Tech Environment Revisited [mimeo]. Madison:
Dakota State University.
References
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Economics Courses”. Journal of Economic Education.
Vol. 25, no. 2, pp. 99-119.
aragon, s. r.; johnson, s. d; shaik, n. (2002). “The
Influence of Learning Style Preferences on Student
Success in Online versus Face-to-face Environments”.
American Journal of Distance Education. Vol. 16, no. 4,
pp. 227-244.
becker, w. e.; powers, j.; saunders; p. (1996). Problems
of Missing Student Data and the Importance of Class Size
in Student Achievement. Working paper. April 1997.
becker, w. e.; watts, m. (2001). “Teaching Methods in
the U.S. Undergraduate Economics Courses”. Journal
of Economic Education. Vol. 32, no. 3, pp. 269-279.
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Do Online Students Perform Better than Face-to-face Students?
Recommended citation
lundberg, johan; castillo, david; dahmani, mounir (2008). “Do Online Students Perform Better than Face-to-face
Students? Reflections and a Short Review of some Empirical Findings”. In: “The Economics of E-learning” [online
monograph]. Revista de Universidad y Sociedad del Conocimiento (RUSC). Vol. 5, no. 1. UOC. [Accessed: dd/mm/yy].
<http://www.uoc.edu/rusc/5/1/dt/eng/lundberg_castillo_dahmani.pdf>
issn 1698-580X
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About the authors
Johan Lundberg
Assistant Professor at the Centre for Regional Science at Umeå University
[email protected]
Dr. Johan Lundberg holds a position as Assistant Professor at the Centre for Regional Science at Umeå University.
He has a PhD in economics and works with research and education within the field of regional economics and
economics of education. He participates in the European eLene-EE project on the economics of e-learning.www1
David Castillo
Assistant Lecturer at the Department of Economics and Business of the UOC.
[email protected]
Dr. David Castillo-Merino holds a position as Assistant Professor at the Department of Economics and Business
of the UOC. He is a member of the New Economy Observatory (IN3-UOC) research group. He is director of
Masters in the field of Corporate Finance. His research interests and areas of expertise include: the economics of
intangible assets, finance and innovation in firms, and e-learning and is an author of books and papers in these
areas. He participates in the European eLene-EE project on the economics of e-learning. www1
[www1] http://www.elene-ee.net/
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Do Online Students Perform Better than Face-to-face Students?
Mounir Dahmani
PhD student in Economics at the University of Paris Sud
[email protected]
Mounir Dahmani is a PhD student in Economics at the University of Paris Sud. He has a degree in Industrial
Economics from the University of Tunis and Master’s in European Markets and Firms strategies. He is currently
teaching Microeconomics, Macroeconomics and organisation theory of the firm at the University of Paris Sud.
In the early years of his PhD, he participated in various research projects including eLene-TT and eLene-EE
European projects. The research topics covered by his PhD are: growth theory, competencies and ICT, e-learning,
human capital and digital divides.
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Monograph “The Economics of E-learning”
article
The Impact of ICT on Student
Performance in Higher Education:
Direct Effects, Indirect Effects and
Organisational Change*
Adel Ben Youssef (Ph.D)
Mounir Dahmani
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
The purpose of the present paper is to examine the relationship between the use of information and communication technologies (ICT) and student performance in higher education. So far, economic research has failed to
provide a clear consensus on the effect of ICT investments on student’s achievement. Our paper aims to summarise
the main findings of the literature and to give two complementary explanations.
The first explanation focuses on the indirect effects of ICT on standard explanatory factors. Since a student’s
performance is mainly explained by a student’s characteristics, educational environment and teachers’ characteristics, ICT may have an impact on these determinants and consequently the outcome of education. The differences
observed in students’ performance are thus more related to the differentiated impact of ICT on standard explanatory factors.
The second hypothesis advocates that ICT uses need a change in the organisation of higher education. While
ICT equipment and use rates are growing very fast in the European Union, the adoption of complementary organisational designs is very slow and differs from one institution to another. This may explain the observed differences
in students’ achievement.
Keywords
ICT use, student performance, higher education institutions, organisational change
JEL codes: A20, A23, I20, I23, O38.
* This Work is partially funded by the European Commission, eLene-EE project: Creating models for the efficient use of e-learning. Introducing
Economics of e-learning – eLene-EE, European Commission (EAC/23/05 SE001). General Directorate for Education and Culture. Participants: University of Umeå, CANEGE (University of Nancy 2-Vidéoscope, University of Nancy, University of Paris-Sud), UOC (Universitat
Oberta de Catalunya), METID-Milano Polithecnic, Maria Curie Sklodowska University (Polish Virtual University). Main researcher: Mikael
Sjöberg (University of Umeå). February 2006-July 2008.
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The Impact of ICT on Student Performance in Higher Education...
El impacto de las TIC en el rendimiento de los estudiantes de educación superior:
Efectos directos, indirectos y cambio organizativo
Resumen
El propósito de este estudio es examinar la relación entre el uso de las tecnologías de la información y de la comunicación (TIC) y el
rendimiento de los estudiantes en la educación superior. Hasta ahora, la investigación económica no ha logrado alcanzar un consenso
claro acerca del efecto de las inversiones en TIC sobre los resultados de los estudiantes. Nuestro estudio trata de resumir los principales
resultados obtenidos en los trabajos publicados y ofrecer dos explicaciones complementarias.
La primera explicación se centra en los efectos indirectos de las TIC sobre factores explicativos estándar. Dado que los resultados
de un estudiante vienen determinados principalmente por las características del propio estudiante, el entorno educativo y las
características de los profesores, las TIC tienen un impacto sobre estos determinantes y, en consecuencia, sobre los resultados de
la educación. Las diferencias observadas en los resultados de los estudiantes se hallan, por tanto, más relacionadas con el impacto
diferenciado de las TIC sobre los factores explicativos estándar.
La segunda hipótesis argumenta que los usos de las TIC necesitan un cambio en la organización de la educación superior.
Mientras los índices de uso y el equipamiento TIC siguen creciendo rápidamente en la Unión Europea, la implementación de diseños
organizativos complementarios se lleva a cabo lentamente y varía de una institución a otra. Esto puede explicar las diferencias
observadas en los resultados de los estudiantes.
Palabras clave
uso de las TIC, rendimiento de los estudiantes, instituciones de enseñanza superior, cambio organizativo
Introduction
focus on the labour market. The outcomes of education are
mainly validated in the labour market.
The relationship between the use of ICT and student
performance in higher education is not clear, and there are
contradictory results in the literature. Earlier economic research has failed to provide a clear consensus concerning
the effect on students’ achievement.
Starting from this point, the aims of this paper are
two-fold: first, we summarise the main findings of this
extensive literature and second, we give two complementary explanations on the contradictory results. Our first
explanation is that most of the literature has focused on
direct effects of ICT while it is more appropriate to look at
the indirect effects through the traditional channels. Since student performance is mainly explained by a student’s
characteristics, educational environment and teachers’
characteristics, ICT may have an impact on these determinants and consequently the outcome of education. The
differences observed in the performances of students are
thus more related to the differentiated impact of ICT on
the standard determinants.
The second explanatory hypothesis is that ICT needs a
shift in organisation. While ICT equipment and use rates
are growing very fast in the European Union, the adoption
of complementary organisational designs is very slow and
During the last two decades higher education institutions
have invested heavily in information and communication
technologies (ICT). ICT has had a major impact in the
university context, in organisation and in teaching and
learning methods.
One puzzling question is the effective impact of these
technologies on student achievement and on the returns of
education. Many academic researchers have tried to answer
this question at the theoretical and empirical levels. They
have faced two main difficulties. On one hand, student
performance is hard to observe and there is still confusion
about its definition. On the other hand, ICT is evolving
technologies and their effects are difficult to isolate from
their environment.
There is no standard definition for student performance. The standard approach focuses on achievement and
curricula, how students understand the courses and obtain
their degrees or their marks. However, a more extensive
definition deals with competencies, skills and attitudes
learned through the education experience. The narrow
definition allows the observation of the outcomes of any
change in higher education, while the more extensive definition needs a more complex strategy of observation and a
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The Impact of ICT on Student Performance in Higher Education...
differs from one institution to another. This may explain
the observed differences in students’ achievement.
Our paper is structured as follows: section one surveys
the literature on students’ performance and the use of ICT,
section two explains the impacts of ICT on the traditional
determinants of students’ performance and finally, section
three underlines the role of organisational change in education on students’ performance.
lection bias, students in the online format of the statistics
class exam scored 14.1% less than in the traditional format,
whereas, for the managerial economics class, the test scores
within both formats were not significantly different.
Navarro and Shoemaker (1999) surveyed a matched pair
of on-campus and online sections of a class on principles of
macroeconomics. The students self-selected the instruction
format, with each section having approximately 30 students,
and there was no difference in the demographic composition
of each section. They used a simple comparison of means of
test scores and reported no significant difference in academic performance between the two formats.
Terry, Lewer and Macy (2003) surveyed 240 students in
a programme offering courses in the three formats of online,
on-campus, and hybrid. Using a standard regression model
where final exam score is the dependent variable and student
characteristics are the independent variables, they report that
predicted exam scores for students in the online courses were
significantly less than those of students in the on-campus and
in the hybrid formats. However, with the comparison of exam
scores between students in the hybrid and students in the oncampus classes there was no significant difference.
Brown and Liedholm (2002) surveyed students in a
matched pair of online and face-to-face principles of economics course taught by the same teacher. They reported
that exam scores, after taking into account differences in
student characteristics, were approximately 6% higher for
the on-campus format than for the online format. They attribute the relatively better performance in the on-campus
classes to the benefit of in-person teacher-student interactions, and attribute the relatively poorer performance of
the students in the online class to the lack of self-discipline
necessary for successful independent learning in the online
environment.
Leuven et al. (2004) concluded that there is no evidence for a relationship between increased educational use of
ICT and students’ performance. In fact, they find a consistently negative and marginally significant relationship between ICT use and some student achievement measures.
Students may use ICT to increase their leisure time and
have less time to study. Online gaming and increased communications channels do not necessarily mean increased
achievement. Many other explanations were presented.
1. ICT and students’ performance:
no clear direct effects
The direct link between ICT use and students’ performance
has been the focus of extensive literature during the last two
decades. Several studies have tried to explain the role and
the added value of these technologies in classrooms and on
student’s performances. The first body of literature explored
the impact of computer uses. Since the Internet revolution,
there has been a shift in the literature that focuses more on
the impact of online activities: use of Internet, use of educative
online platforms, digital devices, use of blogs and wikis, etc.
This literature shows mixed results. On one hand, some
research demonstrates that there is no evidence of a key
role for ICT in higher education (Angrist and Lavy, 2002;
Banerjee et al., 2004; Goolsbee and Guryan, 2002; Kirkpatrick and Cuban, 1998). On the other hand, some studies
show a real impact of ICT on students’ achievement (Kulik, 1999; Sosin et al., 2004; Fushs and Wossman, 2004;
Talley, 2005; Coates et al., 2004).
a) ICT does not play a role in students’
achievement
Coates et al. (2004) surveyed three matched pairs of faceto-face and online principles of economics courses taught
at three different institutions. The students’ score in the
Test of Understanding College Level Economics (TUCE)
given at the end of the term is used as the measure of learning outcomes. After taking into account selection bias
and differences in student characteristics, they report that
the average TUCE scores are almost 15% higher for the
face-to-face format than for the online format.
Anstine and Skidmore (2005) surveyed two matched
pairs of on-campus and online courses, one in statistics,
and the other in managerial economics. They report that
after taking into account student characteristics and se-
b) ICT plays a role in students’ achievement
Kulik’s (1994) meta-analysis study revealed that, on average, students who used ICT-based instruction scored
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The Impact of ICT on Student Performance in Higher Education...
higher than students without computers. The students also
learned more in less time and liked their classes more when
ICT-based instruction was included.
Sosin et al. (2004) constructed a database of 67 sections of introductory economics, enrolling 3,986 students,
taught by 30 instructors in 15 institutions in the United
States of America during the spring and autumn semesters
of 2002. They found significant, but low, positive impact on
student performance due to ICT use. But they showed that
some ICT seems to be positively correlated to performance while others are not.
Fuchs and Woessman (2004) used international data
from the Programme for International Student Assessment
(PISA). They showed that while the bivariate correlation
between the availability of ICT and students’ performance
is strongly and significantly positive, the correlation becomes small and insignificant when other student environment characteristics are taken into consideration.
The analysis of the effects of these methodological and
technological innovations on the students’ attitude towards
the learning process and on students’ performance seems
to be evolving towards a consensus, according to which an
appropriate use of digital technologies in higher education
can have significant positive effects both on students’ attitude and their achievement.
Attwell and Battle (1999) examined the relationship
between having a home computer and school performance,
for a sample of approximately 64,300 students in the United States. Their findings suggest that students who have
access to a computer at home for educational purposes,
have improved scores in reading and maths.
Coates et al. (2004) showed that students in on-campus
courses usually score better than their online counterparts,
but this difference is not significant here.
Li et al. (2003) pointed out: “First, web-based instruction presents information in a non-linear style, allowing
students to explore new information via browsing and
cross-referencing activities. Second, web-based teaching
supports active learning processes emphasized by constructivist theory. Third, web-based education is enhanced
understanding through improved visualization and finally,
the convenience, it could be used any time, at any place”.
one states that, with all else being equal, ICT constitutes an input in the student learning process that should
help produce better learning output. ICT use can enhance
learning by making education less dependent on differing
teacher quality and by making education available at home
throughout the day. Authors argue that the use of ICT can
positively transmit knowledge to students. Furthermore,
ICT use can help students exploit enormous possibilities
for acquiring information for schooling purposes and can
increase learning through communication.
The second hypothesis combines the arguments that:
In fact, all else is not equal. ICT based instruction induces
reallocations, substituting alternative, possibly more effective, forms of instruction. Given a constant overall instruction time, this may decrease student performance. Also,
given that budgets are not perfectly elastic, the introduction of ICT based instruction can result in a reallocation of
funds in favour of ICT, possibly substituting more effective
instructional materials.
ICT can distract learning. This may be particularly salient at home, where Internet access could be a source of
distraction because of chat rooms or online games, reducing the time spent in doing homework or learning. Thus,
the impact of the availability of ICT on student learning
will strongly depend on their specific uses.
ICT-based instruction could restrict the creativity of
the learner. ICT tends to allow acting only in a predefined
way with limited interactive possibilities. This might reduce the students’ abilities in terms of problem solving and
creative thinking in predetermined schemes but not their
ability to come up with independent creative solutions on
their own”
For a better understanding of the link between student
performance and ICT usage, we suggest two alternative research strategies in the next sections. The first one consists
of examining the impact of ICT on traditional explanatory
variables of student’s achievement. The students’ performance depends on other explanatory factors and ICT may
have a profound impact on these factors. Thus, differences
in the observed performance depend on the nature and the
intensity of these changes. The second explanation is given
by the economic literature concerning ICT performance in
economic sectors. Education is a specific sector but can be
considered as an economic sector and the literature on the
“productivity paradox” suggests that organisational change is the key explanation of ICT performance (Sharpe,
2004).
c) A need for clarification and for more
appropriate explanations
Fuchs and Woessman (2004) present two hypotheses explaining the mixed results shown in the literature. The first
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2. Student performance: indirect
effects
also found that age was a significant variable, with older
students performing better than younger ones.
Jaggia and Kelly-Hawke (1999) included variables
concerning school inputs and student’s family background
in order to test whether these two variables influence student performance. They found that higher levels of spending did not have any consistent relationship with student
performance. However, family background was clearly very
important in explaining differences in achievement.
There seems to be a very close link between the ICT
revolution and the socio-economic variables. Family structure, social environment and related variables are not sensitive to ICT, yet ICT may act on secondary education and
contribute to better achievement. However, ICT may have
an impact on students’ motivation. Becker (2000) found
that ICT increases student engagement, which leads to an
increased amount of time students spend working outside
class.
Students’ performance is a puzzling question in education
science and economics. The general approach followed by
economics is to use a model of added value based on the
educational production function. This methodology consists in evaluating the effect of the educational inputs (characteristics and attitudes of the teachers, physical resources
committed in the universities, the teaching organisation,
the rate of students framing, etc.) on the students’ performance by taking into account other inputs (socio-economic
origin, characteristics and attitudes of the students) (see e.g.
Hanusek, 1996, Jaag, 2006; Lazear, 2001; Krueger, 1999).
A large body of literature is dedicated to this subject and
here we are not aiming to survey this research. However,
the findings indicate consistent trends and provide evidence on the relationship between educational environment,
students’ characteristics, teachers’ characteristics and performance of students and we propose to discuss them.
2.2. Educational environment
The second body of economic literature aims to evaluate the impact of the educational inputs on the students’
performance, based on educational production functions
(Hanusek, 2003; Glen, 2006; Glewwe et al., 2004, Glewwee
and Kremer, 2006; Todd and Wolpin, 2003). The starting
point was that the more students benefit from the physical
environment of education the better is their achievement.
Thus, increasing physical investment in education must
lead to better results and performance.
One prominent variable in the environment and physical investment is class size. A better higher education environment is correlated with small classrooms. While the
theoretical hypothesis seems evident, empirical research
is more controversial. On one hand, Krueger (1999) and
Angrist and Lavy (2004) provide evidence in favour of
the positive and significant effect of small classes. Arias
and Walker (2004) conducted an experiment to test the
relationship between class size and student performance.
They controlled variation in instruction, lecture material,
and topic coverage by using the same instructors. Their results were statistically significant showing that small class
size had a positive impact on student performance. On the
other hand, Hanusek (2003) had already shown that one
cannot conclude, without some doubt, that the reduction
of class size improves student performance. Hoxby (2000),
using data on the United States, did not succeed in finding
an effect of class size on student performance. This result
2.1. Students’ characteristics
The first body examines the effect of the students’ socioeconomic characteristics on their educational performance.
Initial socio-economic differences are determinant of their
achievement (age, gender, family structure, level of parents’
education, geographical area, etc.). A large body of literature focuses on the relationship between the students’ school
results and the students’ socio-economic characteristics.
Pozo and Stull (2006) highlighted the importance of
the initial provisions (secondary studies and competence in
mathematics) in success at university. The secondary performance also depends on socio-economic variables. The
students who come from underprivileged socio-economic
environments have worse school performances than the
less underprivileged students (Conger et al., 1997; Haveman and Wolfe, 1995; Wilson, 1987). Bratti et al. (2007)
show that the differences in student performance can be
explained by the differences between the areas in economic
terms of structures, regional leisure, type of institutions
and the individual characteristics of the students (family
and social characteristics).
Didia and Hasnat (1998) examined the determinants
of student performance on an introductory finance course.
They found that age, as a measure of maturity, had a significant influence on performance. Reid (1983) focused his
study on an introductory university economics course and
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was confirmed by other studies conducted by Dustmann
(2003), Mosteller (1995) and Jaag (2006), showing the
existence of a significant and single effect of class size on
student performance.
The effect of the rate of students framing is also a subject
of controversy. In certain studies, one finds that, when it is
weak, it can have a positive effect on the students’ performance. Starting from the results in mathematics in 148 school
institutions in England, Raudenbush and Willms (1995)
showed that a reduction in this ratio from 25 to 16 would
increase the students’ performance. On the other hand, using
data collected in England between 1992 and 1996, Bradley
and Taylor (1998) found that the number of students per
teacher does not have an effect on the students’ performance.
However, they showed a significant, but weak, impact when
they studied the relationship between the variation of this
number between 1992 and 1998 and the variation of performance in the exams during the same period.
Investing in ICT can be considered as physical investment that improves the educational environment. ICT
may act as a means by which higher education institutions
implement interactive learning based on reduced class-size
approach. Firstly, the use of ICT in higher education is
allowing a shift from a teacher-based approach to a student-based approach (Becker, 1997).
Secondly, since the usage of ICT leads to asynchronous
learning the class size does not matter. Using computers
and the Internet, students have more time to interact with
the course. They are not constrained by the available faceto-face time where their understanding and participation
depend on the number of students. Thirdly, concerning
network economics, the value of the network depends on
the number of users. Therefore, the number of students may
have a positive effect on online courses. This result depends
on the teacher’s motivation and student characteristics.
formance in Texas, but teacher education and qualification
have no systematic relationship with performance. Jepsen
and Rivkin (2002) obtained similar results using grade-level
data from California. Preliminary results from Clotfelter et
al. (2003) suggest positive impacts of teacher experience and
teacher license test scores on student achievement in North Carolina. Betts et al. (2003) obtained mixed results for
teacher characteristics using detailed individual-level data in
the San Diego Unified School District.
The lack of significant effects for these teacher characteristics should not be interpreted as evidence that teachers
have no impact on student performance. Teacher quality,
measured by teacher fixed effects, has an important impact
on student achievement, according to Rockoff (2004). In
addition, Hanushek (1971) and Murnane (1975) found
significant impact of classroom fixed effects (i.e. combined
impact of teachers and peers). Rivkin et al. (2005) found a
major effect of overall teacher effects measured at the grade
level. In other words, teacher quality may be important,
but it is not well captured by levels of teacher experience,
certification, and education.
Recent research has pointed out the importance of transforming teaching in order to integrate ICT effectively. ICT is
seen as a catalyst of system, community, school and classroom
reform because it provides opportunities to shift from teacher
centred to student centred learning. In turn, ICT could also
increase the pedagogical repertoire of teachers. This teacher
effect is most likely to improve the outcomes of disadvantaged
students because it attends to individual need and provides
a variety of curriculum and assessment strategies to promote
student capabilities across a range of learning outcomes. In
this sense, good pedagogical practice in the use of ICT to enhance the learning of students who are disadvantaged is good
pedagogical practice for all students. ICT may have an impact
on teacher quality and characteristics, and so student performance and achievement.
Three complementary effects may be observed. First,
teachers’ actions may be complemented by the use of learning from the Internet. The process of learning is not only
based on teachers’ materials. Second, teachers are acting
as learners in the new setting of education. Teachers learn
from peers and also from students. They are co-constructing the courses and are more sensitive to student participation. ICT is transforming the classrooms and focusing
learning more on the process. Third and related to the two
first points, while initial competence and degrees of teachers remain important, new skills are needed and students’
performance seems dependent on the ability of teachers to
develop these new competencies and skills. Extended training is needed in this subject in the European Union.
2.3. Teachers’ characteristics
The third body highlighted the effects of teachers’ characteristics on student performance. The influence of the teacher had already been shown in the seventies by research
of the process-product type of Rosenshine (1971) and that
of Bloom (1979). These studies connected the behaviour
of the teacher (process) with the training of the student
(produced).
In recent empirical studies conducted in the United States, Rivkin et al. (2005) found that teachers in their first or
second year of teaching are associated with lower student per-
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Basic effects of ICT on the teaching process
•
Has an edit effect in terms of quality of student work and practical examples through visualisation;
•
Equalises individual differences and has particularly dramatic effects for students with special needs;
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Improves poor handwriting and languages skills through word processing;
Facilitates self-pacing with increased capacities to deal with individual learning styles as students can work at the pace and intensity suitable to
their needs;
Enables collaborative learning with little indication of the isolated learner;
Encourages use of peer coaching and peer reviews;
Develops communication skills and awareness of different audiences;
Has impact on resource–based learning and access to real world information through the Web;
Increases information reliability and accuracy adding to authenticity of learning tasks, with realistic and up-to-date information;
Increases student motivation through hands-on activity, visual representations and improved modes of presentation;
Encourages independent learning and individual preferences for process, layout, style and format;
Gives students more control;
Allows students to produce high quality multimedia products;
Changes teacher practices, planning tools and assessment rubrics;
Increases opportunities for classes to evolve and for student experiences to shape outcomes;
Has motivated students to commit to learn and to participate in learning activities;
Has improved students’ quality of work and has given them the confidence to perform enhanced learning tasks;
Has allowed students to learn independently, which has enabled more work to be completed, and
Has enhanced achievement due to the reinforcement and practice that ICT has afforded.
3. ICT and student performance:
an enormous lack of organisational
change
thesis seems to be the most accepted nowadays (Greenan
and Mairesse, 2004). Old methods need old educative technologies and new technologies need new organisational
innovations. There is an agreement between researchers that
the usage of ICT requires the usage of new organisational
designs and a shift in organisation. Higher education is not
an exception and needs a huge organisational change.
Organisation is defined as the way decision-making
units are structured within an institution (here universities or
higher education institutions), the way the decision-making
power and skills are distributed and the type of information
and communication structures in place. Thus any change in
the distribution of power, skills, and information or in the lines of communication constitutes an organisational change
(Sah and Stiglitz, 1986). From an evolutionist perspective
(Nelson and Winter, 1982) organisational change is a change in the routines of the universities. The potential benefits,
implications and challenges of introducing ICT into schools
can be very different depending on the vision and the understanding of the nature of this change, as well as strategies
for its management adopted by the leadership at the school
level and beyond (UNESCO, 2003).
Hargreaves (1997) and Meighan (1997) argue that
merging ICT and education requires organisational chan-
Looking at the link between ICT and student performance seems nowadays a misunderstanding of the role and
nature of these technologies. In fact, since ICT is general purpose technology (GPT), it needs to be specified in
order to meet the needs expressed by students and to be
adapted to the local context and constraints (Antonelli,
2003; Ben Youssef, 2008). A variety of models of usages
can be identified leading to the same outcome. ICT brings
widened possibilities for the learning processes that are
independent from place and space. ICT also allows more
flexible (asynchronous) and more personalised learning. It
offers new methods of delivering higher education. Taking
advantage of these opportunities needs a profound change
in the organisation of the higher education system.
Economic literature in the last decade has shown that
technological change, on its own, does not lead to any
change in economic performance. Among the most popular explanations of this paradox – huge investment in ICT
without any economic performance – the complementarity
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ges at the level of the whole system: in the direction of
allowing more distance-learning or even virtual schooling,
thus changing the attitude towards time, place, curriculum
and other connected attributes of the system.
ICT has a profound impact in classrooms. It adds complexity to a non-linear system. This complexity needs a major change in organisation. Downes (2001) differentiates
four levels of use of ICT in the classroom:
Level 1: ICT skills are added into the school programme through a separate ICT subject, while teacher practices
in other subjects remain unchanged;
Level 2: ICT skills are integrated into teachers’ daily
work with some teachers’ pedagogical practices and classroom behaviour remaining the same, while the practices
of others change more radically;
Level 3: ICT is transformative at the classroom level
as it changes content as well as pedagogy (what students
learn as well as how they learn it);
Level 4: ICT is transformative at the system level leading to changes in the organisational and structural features of schooling.
Performance is then observed when the institutions
reach the third or fourth levels. Most universities are currently working at level one and two, especially universities
with scarce or few resources. The usage of computers in
classrooms is more often based on the vision of the teacher
and his or her beliefs about ICT. In some cases, when ICT
is introduced without changes in organisation this may
lead to a decrease in student performance and the outcomes of the education.
From our perspective, organisational change related to
ICT and its link to students’ performance need to focus on
at least four basic principles. First, ICT is collaborative technology and needs to be used as such. Second, ICT allows
the personalisation of education and personal services are a
key element of ICT in education. Third, universities must
be viewed as learning organisations. Fourth, the outcomes
of education are changing through ICT and we need to
focus more on competencies rather than curricula.
collaborative culture among students and between students
and teachers. ICT is mainly collaborative and interactive.
Improving the outcomes of the learning process needs a
change in the way students interact. This is not a trivial dimension. Nowadays, several technologies allow co-writing
and sharing resources (Wikis, blogs, etc.). The collaborative and co-operative dimensions of the learning process
are fundamental and an organisational change is needed in
order to explore this dimension. Collaboration is also one
of the most highly-searched for skills in the job market. By
enhancing the learning of this kind of skill, higher education provides the job market with better workers.
ii. ICT allows personalised learning
and organisation must follow this
trend
ICT is based on individual access, personal mobile phones,
personal computers etc. as well as the new trend for personalisation of the Web. This implies that the needs and
the competencies of students are quiet different, and since
ICT allows one-to-one learning, a more personalised learning may constitute the future trend of higher education.
Better achievement of students is easier to obtain since the
learning is personalised and customised. However, this implies a huge change in the format, in the organisation of
the classrooms and in the competencies and availability of
teachers. This may explain the differences observed in the
impact of ICT on the performance of students. Wherever
the introduction of ICT is associated with a personalised
service for students, performance increases.
iii. Universities as a learning
organisation
Hargreaves (1997) and Meighan (1997) argue that the
potential impact of the implementation of ICT in higher
education will not be observable without organisational
changes at the level of the whole system. Universities must
act as a learning organisation. ICT implies more interactions among all the actors. The institution is then developing
collective learning by changing its rules and routines. But
the main change is that innovation becomes the heart of
the learning process. Teachers and students are exploring the
new possibilities given by these technologies and construc-
i. A shift to a more collaborative
and less individualist model of
learning
Few economic studies have tried to examine this dimension in the higher education sector. Fullan (1999) mentions that reforms failed due to the problem of changes in
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ting capabilities concerning learning through ICT. Building
capabilities concerning ICT usage in education becomes a
discriminatory element among universities. The attitudes
toward time, place, curriculum and other connected attributes of the system on a systemic level are changing.
student achievement. ICT seems to have a profound impact on the process of learning in higher education by
offering new possibilities for learners and teachers. These
possibilities can have an impact on student performance
and achievement. There are contradictory results in the
empirical literature in this field. Three different arguments
can be given in order to explain this lack of empirical evidence. First, since ICT is a form of GPT and immature
by nature, a long process of appropriation and exploration of their possibilities by higher education institutions
is needed before observing any significant change. This
has been the case in other economic sectors and it is also
true in higher education. Second, we consider the lack
of organisational change in higher education the main
explanation. While universities have invested heavily in
equipment, and at the same time students and teachers
are using these technologies more and more, there has
been little change on the organisational side. The adoption of complementary organisational innovations is a
major factor in student performances and achievement.
Third, returns of education using ICT are changing. Students are acquiring new skills and new competencies –
more collaboration, team building, project management
– closer to the needs in the job market and perhaps less
performance on curricula. Observing the performance of
students needs to deal more with these topics and less
with knowledge of specific topic and curricula.
iv. The outcomes of higher
education are changing
The impact of ICT on the learning process seems to be
more important and requires more than looking only to
curricula. Improved student outcomes are observed, with
regard to: motivation, enjoying learning; self-esteem; ICT
skills; collaborative skills; subject knowledge; information
handling skills; meta-cognitive skills, etc.
In European higher education institutions, while students and teachers seem to be using the new available technologies more and more intensively, organisational designs
are changing slowly. The lack of a strategy regarding organisational change, as several studies have shown, leads to a
weak impact of the use of ICT on student performance.
Flexibility of training
ICT is considered to exploit the flexibility of training. The
rhythm of study, the allocation of time and the availability
of teachers can allow better articulation between private life/
professional life (studies) as well as a better allocation of time
between the various uses. This allows better student performance in pecuniary terms of profits and achievement. There
is also the quality of the training. The teaching support, the
availability of resources and the variety of training channels
may change following the introduction of the ICT. This
would make it possible for students to acquire e-skills and to
develop them in the labour market (OECD, 2006). Some go
as far as claiming that the use of innovative models of training
permitted by the introduction of ICT could make it possible
for the students to “carry out team work, to share knowledge
and to decrease individualism in order to promote the authorized capital” (Lundin and Magnusson, 2003).
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The Impact of ICT on Student Performance in Higher Education...
Recommended citation
ben youssef, adel; dahmani, mounir (2008). “The Impact of ICT on Student Performance in Higher Education:
Direct Effects, Indirect Effects and Organizational Change”. In: “The Economics of E-learning”[online monograph].
Revista de Universidad y Sociedad del Conocimiento (RUSC). Vol. 5, no. 1. UOC. [Accessed: dd/mm/yy].
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About the authors
Adel Ben Youssef (Ph.D)
Assistant Professor at the University Paris Sud
[email protected]
Dr. Adel Ben Youssef is Assistant Professor at the University Paris Sud (Paris 11). He is responsible for the Master´s
European Markets and Firms Strategies. His research interests and areas of expertise include: digital divides, ICT
economic performances, E-learning, Eco-labelling, European integration and the Euro-Mediterranean integration
process. He is the author of 30 publications related to his research interests. He is currently coordinating a special
issue of Reseaux in the area of European Educational Digital Trajectories.
Mounir Dahmani
PhD student in Economics at the University of Paris Sud
[email protected]
Mounir Dahmani is a PhD student in Economics at the University of Paris Sud. He has a degree in Industrial
Economics from the University of Tunis and Master’s in European Markets and Firms strategies. He is currently
teaching Microeconomics, Macroeconomics and organisation theory of the firm at the University of Paris Sud.
In the early years of his PhD, he participated in various research projects including eLene-TT and eLene-EE
European projects. The research topics covered by his PhD are: growth theory, competencies and ICT, e-learning,
human capital and digital divides.
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Monograph “The Economics of E-learning”
article
Describing E-learning Development
in European Higher Education
Institutions Using a Balanced
Scorecard
Thierry Garrot
Maria Psillaki
Sylvie Rochhia
We are grateful to Adam Chmielewski, Susanna Sancassani,������������������������������������������������
Florence Ducreau, Bernard Lauch, Alessandra Tomasini, Grace-Blanche Nganmini and other members of the eLene-EE work package 3
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
This paper has strong links with the European Commission’s statement on the initiative “E-learning: designing
tomorrow’s education”, adopted on 24 May 2000. It tackles the question of how Higher Education Institutions
(HEI) follow the development of and manage their e-learning activities. This emerged in work package no. 3 of the
eLene-EE project (Economics of e-learning, 2006-2007), which examines the economic models of e-learning.
With the help of a Balanced Scorecard (BSC), designed by e-learning practitioners, and researchers in economy
and management, the e-learning development of European institutions is described over a three-year period (200406). The BSC shows what is prioritized and how HEI act using four main dimensions: Financial, Customers/Students, Internal Business Process and Learning/Growth. Four examples, from the universities of Lublin (on behalf
of the Polish Virtual University), the Centro METID in Milan (Politecnico di Milano), and the universities of
Nancy and Nice Sophia Antipolis, show different stages of development, different strategic choices and underline
common aspects that could be used to design e-learning evolution models in European HEI.
Although this approach is focused on information in the HEI management field, it suggests firstly that there is
a need for more research and for the elaboration of theoretical tools to conceptualize trajectories of development,
and secondly, the need for BSC to be extended to all areas of HEI in order to promote coherency of student education, research, continuing education and e-learning.
Keywords
e-learning, management, higher education, BSC, strategy, control
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La descripción del desarrollo del e-learning en instituciones de educación superior de
la Unión Europea mediante un cuadro de mando integral
Resumen
El presente estudio está estrechamente vinculado a la declaración de la Comisión Europea sobre la iniciativa “E-learning: el diseño
de la educación del mañana”, adoptada el 24 de mayo de 2000. Trata la cuestión de cómo las instituciones de educación superior
gestionan y siguen el desarrollo de sus actividades de e-learning. Este tema salió a la luz en el paquete de trabajos n.º 3 del proyecto
eLene-EE (La economía del e-learning 2006-2007), que examina los modelos económicos del e-learning.
Con la ayuda de un cuadro de mando integral, diseñado por practicantes de e-learning e investigadores en economía y gestión,
se describe el desarrollo del e-learning de las instituciones europeas a lo largo de un periodo de tres años (2004-06). El cuadro
de mando integral muestra a qué aspectos se da prioridad y cómo actúan las instituciones de enseñanza superior usando cuatro
dimensiones principales: financiera, clientes/estudiantes, proceso empresarial interno y aprendizaje/crecimiento. Los cuatro ejemplos,
de las universidades de Lublin (en nombre de la Universidad Virtual Polaca), el Centro METID de Milán (Politecnico di Milano)
y las universidades de Nancy y Sophia Antipolis de Niza, muestran diferentes estadios de desarrollo, diferentes elecciones estratégicas
y subrayan aspectos comunes que se podrían usar para diseñar modelos de evolución del e-learning en las instituciones de enseñanza
superior europeas.
Aunque este análisis se centra en datos del campo de la gestión de las instituciones de enseñanza superior, indica, en primer lugar,
la necesidad de seguir investigando y de desarrollar herramientas teóricas para conceptualizar las trayectorias de desarrollo y, en
segundo lugar, la necesidad de ampliar el cuadro de mando integral a todas las áreas de las instituciones de enseñanza superior para
promover la coherencia de la educación de los estudiantes, la investigación, la educación continua y el e-learning.
Palabras clave
e-learning, gestión, educación superior, cuadro de mando integral (CMI), estrategia, control
1. Introduction
e-learning network “eLene”. They identified common strategic perspectives and prepared responses to the calls for
proposals in the framework of the e-learning programme.
eLene-EE (Economics of e-learning, 2006-2007) is the
second application to a call for proposals; it considers the
economic models of e-learning (OECD, 2005).
As part of this project, work package 3 (WP3) of the
eLene-EE project has been looking at the management
of the e-learning activities in Higher Education Institutions through the use of a balanced scorecard (BSC).
This entails monitoring the changes and development
of e-learning activities in universities. The three partners
involved in WP3, the METID centre at the Politecnico di Milano,2 the Polish Virtual University3 and the
CANEGE consortium are all at more or less advanced
phases in the development and structuring of their mod-
This paper has strong links with the European Commission’s statement on the initiative “E-learning: designing
tomorrow’s education” adopted on 24 May 2000. This initiative, following on from the conclusions of the European
Council in Lisbon, presented the principles, objectives
and prospective actions related to e-learning, defined as
the use of new multimedia technologies and the Internet,
to improve the quality of learning and facilitate access to
resources and services, such as exchanges and distance collaboration (European Community Commission, 2001).
Following the study “Virtual Models of European Universities: e-learning in higher education” (elearningeuropa.info, 2004) ordered by the European Commisson,
eight institutions or consortia1 co-operated to set up the
1. France: CANEGE, Italy: Politecnico di Milano, Germany: University of Bremen, Netherlands: University of Utrecht, Finland: Finnish Virtual
University, Spain: UOC (Universitat Oberta de Catalunya), Sweden: University of Umeå.
2. Centro METID (Metodi e Tecnologie Innovative per la Didattica) -Politecnico di Milano.
3. Marie Curie Sklodowska University in Lublin, on behalf of the Polish Virtual University.
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els of learning via the Internet. They clearly need to show,
within their own institutions, how their e-learning activities are progressing. The partners in the eLene-EE
group collectively decided to focus the study on higher
education institutions and to adopt a resolutely managerial approach. The macro-economic aspect, of interest
to financiers, will be dealt with using a bottom up approach. The idea is to use a set of data gathered at each
university within the region, and in neighbouring regions,
and possibly neighbouring states, to verify the governing dynamics (past and present) behind the development
of e-learning. This decision was taken because, with the
introduction of e-learning activities, there is a lot at stake
for the future of higher education institutions, and there
is an apparent lack of tools to monitor the development
of e-learning activities. Management, based solely on an
annual budget with a balanced distribution of resources,
will be insufficient to have an accurate overview in an
environment where changes will inevitably accelerate. So,
WP3 focused its efforts on a BSC approach.
Using the BSC elaborated in the eLene-EE WP3, we
describe e-learning developments in four European cases.
They demonstrate different stages of development, different strategic choices and underline common aspects that
could design e-learning evolution models for European
HEIs. We discuss these observations within the HEI management field and in terms of future research.
2. Presentation of the BSC
Kaplan and Norton (1997) inspired the designing of the
BSC, adapted for e-learning activities in HEI. They developed a scorecard that provides a balanced representation
of the life of a company by combining the indicators from
four perspectives: financial, customer, internal processes
and organizational learning.
In the e-learning context, the BSC adapted the four dimensions detailed into specific indicators. The table below
provides a summary:
Table 1: BSC of e-learning development in higher education
Financial
Proportion of expenditure of the establishment allocated to e-learning (general running costs, investment and maintenance of investment).
Proportion of profit generated by e-learning in relation to total profit.
Customer / Student
Proportion of students enrolled in e-learning/ Mixed formula/ enhanced face-to-face in relation to total numbers.
Proportion of instructors using e-learning/ Mixed formula/ enhanced face-to-face
Proportion of courses offered in e-learning/ Mixed formula/ enhanced face-to-face.
Number of complementary Internet services offered (administration, CROUS, library, leisure, etc.).
Internal business processes
Pedagogical matrix: Proportion of digital media available and rate of evolution per category in terms of media and tutoring offered.
Infrastructure dedicated to e-learning measured in terms of capacity and charge rate for the servers, network and staff.
Training: Proportion and average number of training hours followed by the student, administrative staff and teachers in the use of e-learning tools.
Degree of overall satisfaction with e-learning on the part of e-tool users.
Learning and growth
Degree of university participation in an e-learning related event (all types of communication).
Number of national or international e-learning projects organised by the university.
Number of new e-learning partnerships with public or private organisations.
The case studies in this paper give an opportunity to
collect data and illustrate the use of these indicators. The
way the WP3 group worked was essential in this process.
From a general question related to “Indicators of e-learn-
ing”, we became involved in a practical way with academics
working to link competencies and to define indicators relevant to HEI level and also to regional, state and European
e-learning policy”
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During the conceptual phase, we made continuing
mutually agreed adjustments to the specificities of the
situations of the partners and the defined objectives. We
integrated dimensions relating to the quality of services
provided to customers and some indicators of e-learning
progression in society. We tried to identify the elements
of its development. The objective of BSC was to highlight
questions such as:
implementation of LOLF (French Organic Law of the Financial Law), one of whose objectives is to bring together
cost accounting data and qualitative information to enable
the monitoring of national policies in higher education,
benefiting the public interest.
In what follows we describe the BSC and e-learning
development in four European universities.
• How are e-learning and ICT uses progressing in our
HEI?
• Have policies increased the number of e-learning students and the quality of the learning?
• What impact does the policy have on ICT use?
3. E-learning development of four
European universities
The most important result of the WP3 work is related to
institutions. Use of the BSC allowed decision makers to
understand the history of HEIs and to design a coherent
plan for their future. But the set of indicators also provides
information that allows us to distinguish among European
HEIs. The four institutions, that participated in the eLeneEE project, presented their own case studies at the conference in Paris in December 2007, and here we summarize
the main elements. We begin with the establishments that
took up e-learning activities less than six years ago and
continue with those that have been involved in e-learning
for more than ten years i.e. from at least the beginning of
the period studied (2004-06).
Adopting a bottom up approach focused on accurate
data at the HEI level, the partners found it difficult to obtain the relevant data on their institutions. Over the threeyear period 2004-2006, they set up one database for each
year, with more than 100 basic variables collected at lower
levels. In order to be as exhaustive and as flexible as possible, we chose the faculty level for our data collection. We
then compiled the information at university level for each
year and for each basic variable. Using these consolidated
data, we were able to calculate the 11/12 indicators and to
represent them on graphs depicting their evolution in four
dimensions.
The BSC is a tool for the measurement and management of performance (Radnor and Lovell, 2003) in public organizations in the field of e-learning. In this study
it posed questions for universities and HEIs on several
subjects. One was a definition of the usefulness of these
institutions in relation to the country studied, which is not
always clear; in these cases, the implementation of a tool
to measure the impacts of e-learning did not appear to be
a priority. The information that traditionally is available to
management is rather general, whereas the methodology
of the BSC requires well defined inquiries and accurate answers from the information system. This system represents
the third difficulty we encountered. Sometimes, the data
were required in more detail than available in the information systems, creating the need to identify and contact the
person who could provide more extensive information. In
many cases this was not a straightforward exercise but generally we had the co-operation of experts at the universities
in seeking out the relevant data.
This situation should improve as European countries
make efforts to improve the transparency of their policies
and strategies. For example, in France, there is ongoing
3.1. Youngest institutions in terms of
e-learning
3.1.1. Maria Curie Sklodowska University of Lublin
As noted by Chmielewski (2007), the Maria Curie Sklodowska University (MCSU) of Lublin was established in
1944 and has been steadily expanding its programme in
order to meet the changing needs and standards of a leading European HEI. About 33,000 students are currently
enrolled in courses offered by ten faculties in 30 different
study programmes. The university employs approximately
1,800 staff. Postgraduate and doctoral study programmes
are increasingly popular.
MCSU is the most recent university in our sample to
introduce e-learning, for which purpose in 2001 it created
the University Centre for Distance Learning (UCZNiKO).
UCZNiKO is the university department responsible for
organizing and running projects that involve online education. Its objective is to prepare, organize and run projects
that involve the Internet in the provision of higher educa-
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tion. The first project to be launched was the Polish Virtual
University (PVU).
PVU was initiated in March 2001 by UMCS in collaboration with Academy of Humanities and Economics (AHE) in Lodz and ran till February 2002. PVU’s
main objective was the creation and the management of
distance learning courses and to this end technology was
developed for the production of the courses based on the
latest achievements in the ICT field. PVU set up a team
of people researching the theoretical, methodological and
practical aspects of distance education. One of PVU’s aims
was to transfer knowledge from world leaders in the field
to the Polish educational system. Its main objective was
two-fold: to offer programmes and courses over the Internet and to promote modern teaching methods to support
traditional lectures. So far, UCZNiKO has developed four
specialties online:
• 2002/03: in marketing and management, and in computer science, at bachelor’s degree level at the AHE;
• 2003/04: in political science, at bachelors level at the
AHE;
• 2004/05: in administration, at masters degree level at
the MCSU.
With the introduction of BSC courses period, the
trends in the type of students involved in e-learning
changed. The sharp increase in 2005 and 2006 is not due
to MA courses alone.
Figure 1: UCMS indicators for BSC courses, and data on customer and internal business process
In 2004, UCZNiKO launched its Virtual Campus
project aimed at encouraging the use and incorporation of
ICT by professors into traditional lectures and combining
ICT use with traditional teaching methods. UCZNiKO
promoted the use of ICT through this project. It also dealt
with the critical question of the measurement of ICT
ability in teaching and developed a system of training for
professors who wanted to improve their knowledge on the
distance-learning platform. Following a difficult start, the
UCZNiKO team decided that “agents of change” were
needed – experts and enthusiasts in e-learning who could
engender enthusiasm in others. A small group was set up
and the Virtual Campus became a sort of spontaneous
initiative of tutors, engaged in the project out of interest
and not for any additional monetary reward. Now, in 2008,
over 6,000 people are active participants in the Virtual
Campus. The right hand side of figure 1 shows that this
has been achieved with medium levels4 of interaction and
4. Offers a textual medium with a voice or video recording of the lesson and interactions, using tools such as a messaging service, discussion forums
and/or chat rooms.
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media input.5 The biggest increases in participation occurred in 2005 and 2006. The lower left hand side of figure
1, however, shows that all the degrees on offer are on Web
Enhanced Learning (WEL), which means that less than
30% of study hours are distance learning. The MCSU has
yet to diversify its distance education offer to Blended or
Full Online learning.
In the other two dimensions, MCSU spent, on average during the period, 0.135% of its total budget and
earned 0.065% of its total incomes. This is a small financial impact. In the learning and growth dimension,
MCSU appears very dynamic in terms of new partnerships and projects developed, which stand at around 20
per year. The university lectures and researchers have also
participated in many conferences, up to 80 per year during the period studied.
for government projects such as French Virtual Campuses.
Co-operation with other higher education agents has allowed UNS to gain organizational competences in the
management of collaborative projects. Although by the end
of 2003 few diplomas had been gained over the web, UNS
has developed several mixed media resources and specific
pedagogical approaches with partners for online courses.
The development of e-learning during the five years
1999-2003 has been sufficiently important to create a department devoted solely to these activities. However, the
four-year contract (2004-2007) and the latest ministerial
e-learning policy have provoked UNS to change its strategy especially in organizational aspects. We look at these
changes using the BSC.
From 2004, the change in the state’s e-learning policy led UNS to join the Numerical Universities Region
(UNR) and the Numerical Thematic Universities (UNT).
The purpose of the former is to share hardware and software investments at a regional level; the latter was aimed at
the sharing of already existing numerical resources in academic disciplines. Consequently, the department dedicated
to ICT in learning was reorganized to initiate, support and
manage any ICT integration projects and learning activities. However, this structural change has not resulted in a
change in teaching practices or an evolution of learning
processes (Garrett and Jokiverta 2004). Most changes have
been limited to e-learning tools and to the characteristics
of web courses.
3.1.2. University of Nice Sophia Antipolis (UNS)
Since 1999, the University of Nice Sophia Antipolis (UNS)
– the second ranked multidisciplinary university in France
– has been committed to the development of ICT-mediated learning and the support of individual initiatives as well
as collective projects (Garrot, Psillaki and Rochhia, 2007).
In terms of funding, it has maintained both a bilateral dimension with the Ministry of National Education, and a
multilateral one, with the setting up of networks to tender
Figure 2: UNS indicators and data on internal business process (BSC)
5. The media input is not shown as the figure is the same as for interaction.
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For the UNS, medium and high levels of interaction
and mixed media use prevailed until 2005. From then, the
trend for BSC indicators was to decrease. For example,
the percentage of courses proposed with high levels of
media interaction dropped from 46.20 in 2004 to 12.67
in 2006. A similar trend can be observed for the costs
related to interconnection services, to learning content
(such as courses and learning material, simulation, virtual
reality) and learning interaction (such as forum, email,
collaborative tools, tutorial systems, etc.). Most investments were before 2004; consequently, the investment
trend is also fairly stable after this time. Moreover, the
comparison between expenditures and income underlines
the weakness of the UNS resources dedicated to e-learning; the increase in the financial effort is no more than
0.22 per cent over the 2004-2006 period.
Thus, 2005 can be considered a turning point in the
trajectory followed by UNS. The interaction level decreases,
and the evolution of courses with high levels of interaction
and media use remains stable. However, in the following two
years, UNS began to direct efforts towards web enhanced
courses and ICT related staff training (see below figure 3).
Since 2005, the number of web-enhanced learning
diplomas has risen sharply. This investment orientation
directly benefits students. In 2004, only 2.06 percent of
students were participating in e-learning; in 2006 this
rose to 28.05 percent. At the same time, the percentage of
professors involved increased from 12.42 in 2004 to 41.28
in 2006. Significant efforts have also been undertaken in
the training of staff. For example, the number of professors
who have undertaken training programmes increased from
5.15 percent in 2004 to 21.78 percent in 2006.
Figure 3: UNS indicators and data on customer and internal business process (BSC)
The UNS trajectory is currently much more oriented
towards web-enhanced learning and ICT based administration. ICT use in web-enhanced learning seems to be
less intensive than in online diplomas. In other words, its
use tends to replace already existing tools and to facilitate
teaching practices, without changing learning processes.
Moreover, in spite of efforts made in using ICT for
learning, the proportion of e-learning courses that are
available is still quite small: UNS has only 7 percent.
However, it shows good progression because a large part
of courses involve low levels of media and low levels of
interaction.
Regarding the learning and growth dimension, UNS
became much more dynamic in 2006, especially in terms
of conferences and projects. The e-learning ministerial
policies (UNR, UNT) started in 2004 could explain the
increase in these indicators.
Finally, it should be noted that, like the Polish university, UNS is devoting e-learning investment to webenhanced courses. This investment orientation has the
advantage of needing only modest financial and pedagogical commitment while benefiting a large number of
students. Although the BSC indicators sometimes differ
quite widely for these two universities, their evolution
has been similar with regard to the characteristics of web
courses (levels of interaction and mixed media). In both
cases, we can see a change in their e-learning trajectories
during 2005.
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3.2. Most experienced institutions
in terms of e-learning
was completely integrated into university policy. Through
the Centre Videoscope, created in 1977, UN2 offers engineering and communication technology training, and
intervenes as executive producer, partner or subcontractor
in many academic institutions. The Ministry of Higher
Education awarded Videoscope responsibility for project
management and production of COMPETICE, whose
goal is the design and implementation of a piloting tool
for competencies in ICT. Videoscope is also a privileged
partner in broadcasting led by the Ministry, including Amphis of 5, Canal-U and French universities’ web TV.
At the beginning of the period, in 2004, more than 3,000
students were enrolled in e-learning degree courses (online or
web-enhanced diplomas). In 2005, an important step in the
process of ICT integration was made with the implementation of a digital work space (ENT) to support distant access
and resource sharing in a personalized environment. Expenditures on e-learning doubled in 2005 and reached 1% of the
university budget in 2006. This evolution is mostly due to a
major increase in the general expenses for e-learning (a 70%
increase), in which staff costs play an important role.
3.2.1. Nancy 2: Videoscope
In 2007, Ducreau and Lauch stated that the University
of Nancy 2 (UN2), which is among the most innovative
French HEIs investing in e-learning, has 20 years’ experience in open and distance learning activities. Only the
most significant events are described.
The implementation and use of ICT began in the late
1990s with the launch by the Ministry of National Education and Research of three calls for successive projects in
2000, 2001 and 2002 for the creation of French Virtual
Campuses. Among the first innovative initiatives launched
by UN2 was the operating system News busters, which
started in the mid 1990s, in response to a request from
the humanities faculty, and is still in force. But it was not
until the Centre for University Distance Learning (CTU),
which became ERUDI in 2007, was created, that ICT
Figure 4: Nancy 2 indicators on financial dimension (BSC)
Between 2004 and 2006, expenditure and income grew
in a comparable way, and e-learning incomes represented
1.2 percent of the university budget in 2006. A discrepancy
between the increases in general expenditures and investments arose because of the duplication, in 2005, of the human resources involved in open and distance learning. This
investment in human capital represented 19.3 percent of
total e-learning expenditure in 2004, falling to 7 percent in
2006. Moreover, 2004 is characterized by the development
of new platforms requiring initial financing. This investment in the technical framework was directed particularly
towards increasing the capacity of the servers that were
required to support and manage the fast growth in traffic,
and improving the quantity and quality of materials used
in teaching (Rumble, 2001).
Training sessions for people (students, administrative
and teaching staff ) involved in e-learning increased. It
is interesting to note that, despite a decrease in the total
number of university students since 2004, the number of
those that have been or are enrolled in ICT training increased, reaching 30 percent in 2006.
UN2 funded a great part of its e-learning activities
through its involvement in a diversity of institutional
projects (Ministry of Higher Education and Research, re-
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gional and European institutions). But the university had
no strategy of its own to fund e-learning activities until
2005. The strategic e-learning orientation of UN2 only
emerged after the four year contract (2005-2008), at the
financial and managerial levels. As at other universities, the
proportion of online diplomas is falling, so incomes from
e-learning, which represent about 25 percent of university
funding, is not growing. The number of students following
e-learning diplomas increased between 2004 and 2006, but
most, around 80 per cent, were following web-enhanced
diplomas. As already noted, this investment orientation
has the advantage of necessitating a moderate commitment while affecting numerous students. The percentage of
students and teachers involved in e-learning is increasing.
This upward trend in the numbers of people involved in
e-learning explains the increase in the indicators for technical capacity and training.
Figure 5: Nancy 2 indicators on customers / students dimension (BSC)
Like the other three universities, UN2 has undertaken
important efforts on the training of staff, teachers and administrators. However, unlike the other three universities,
the proportion of UN2’s courses that offer high levels of
mixed-media (virtual laboratories, collaboration activities,
etc.) is not decreasing. Although the figures fluctuated
between 2004/2005, UN2 has generally consistently continued to develop web courses with high levels of media
content. Also the level of human interaction is increasing, with a positive trend in the number of courses with
medium and high levels of interaction. The evolution of
courses with low levels of human interaction has decreased
dramatically (see figure 6). This can be explained by the
initiatives for regular training of teachers, by experience
feedback from the existing systems and by the desire to
improve the quality of pedagogic support and content. The
extended experience in e-learning activities explains the
relative weakness of the indicators on projects; the learning and growth dimension is oriented towards conferences
as most projects were established prior to 2004.
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Figure 6: Nancy 2 indicators on internal business process dimension (BSC)
3.2.2. Politecnico of Milan: METID Centre
students were enrolled in this online degree course. In 2005,
METID addressed multimedia and technological aspects in
several projects targeting schools, enterprises, special contexts (prisons, people with disabilities, etc.). These projects
were developed in partnership with agents external to the
university: ministries, regional or local administrations, private companies, and other associations, such as syndicates,
not-for-profit associations, etc. Currently the Politecnico is
developing e-learning as a strategic support for three aspects:
increasing the quality of the traditional didactic activities;
developing new extracurricular paths (particularly related
to lifelong learning); and the development of international
projects where e-learning seems to provide a powerful means
to enhance the internationalization of the university.
Data show that the proportion of e-learning in the university budget was 0.23 percent in 2004, 0.21 percent in
2005, and 0.26 percent in 2006. This trend is linked to the
fact that a consistent part of the investment in e-learning is
connected to projects funded by external institutions. But
indeed, this financing depends partially on the political or
economic context.
According to Sancassani and Tomasini (2007), the Politecnico of Milan was the first Italian HEI to invest in elearning. In 1995 the Politecnico decided to concentrate on
e-learning activities with dedicated staff in a specific centre:
the METID Centre. METID is devoted to the development
and adoption of innovative tools and methodologies in university teaching. In particular it promotes support for teachers
and didactical innovation via the use of computers, multimedia and telecommunications technologies. METID developed and maintains videoconferencing to enable students
to follow lectures from all Politecnico Campuses without
the need to travel. For instance, the “Laurea On Line” is a
degree in Computer Engineering and the first fully online
Italian university degree. The project started in 2000, and the
first students completed their degree studies in July 2003.
Great attention was paid to guaranteeing a high quality offering: the same teachers and tutors were involved as in face
to face courses, and the course programmes and examinations were of the same high quality. In 2007 more than 450
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Figure 7: Politecnico di Milano indicators on financial dimension (BSC)
The expenditures are mainly general costs, which include staff costs. The conception and realization of an elearning project requires a high level of human resources
engagement in multimedia, software and methodology
development and, moreover, detailed management and
monitoring throughout the didactic path. The increase in
expenses is less evident (0.01%, 0.19% and 0.20% for the
2004-2006 period) because both general costs and annual
costs of e-learning showed similar increases in 2006. In
2004, the percentage of investments was 0.04 per cent of
e-learning expenditures in the university budget. There
was a slowdown in 2005 (investments dropped to 0.02%),
because purchases in the previous year covered part of the
project requirements for 2005, and then rose in the following year to 0.03%. Analysing income over the three
year period 2004, 2005 and 2006, we can see a consistent increase in the amount of income for the university in
e-learning: 0.48 percent, 0.51 percent and 0.54 per cent
respectively. The BSC graph shows this trend very clearly.
E-learning development is funded by a variety of
sources: in part directly by the university but to a greater
extent externally, by public institutions or private organizations. It is important to highlight this because annual
e-learning activities are strictly linked to the origin and the
amount of financing. In 2006, for example, the change in
the Italian government, linked to a reorganization within
public institutions, caused a temporary slowdown in the
economic flux of new projects.
As can be seen in the table below, the highest figures
for courses correspond to those with low levels of media
and interaction: around 89% in 2004 and a slight fall to
87.11% in 2005, even though absolute numbers increased
between 2004 and 2006 (low level courses represent almost the totality of web courses in each year, so the proportion remains similar). It is also interesting to point out
that the number of students involved in e-learning at any
level constantly grew since 2004, eventually encompassing
almost all of the Politecnico’s students: 69.85% in 2004
and 99.61% in 2006. However, the vast proportion of web
students follow web-enhanced diplomas. Blended and elearning diplomas represent a small part of the university’s
enrolment, but they are very relevant from a strategic point
of view in enhancing the exploration and development of
new technologies and methodologies. Learners following
online diploma courses decreased from 527 in 2004 to 343
in 2006. This trend is particularly due to new and similar
offerings from other universities in Italy, which are often
easier and cheaper than the very selective courses offered
by the Politecnico. The rate of evolution of courses with
medium and high levels of ICT integration remains low,
but they are very important in providing contexts for the
testing and development of innovative solutions for future
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integration in the standard services offered by the university. The number of courses with high levels of media and
human interaction has risen in recent years, although they
represent a small proportion of the total number of web
courses. Their rate decreased from 10.45 percent in 2004
to 3.64 percent in 2006 because of the parallel growth of
low level media and low level interaction courses provided
by the university.
Figure 8: Politecnico di Milano indicators on internal business process dimension (BSC)
Courses with medium levels of ICT integration have
been offered as blended Masters and extracurricular
courses. Blended courses represent a very particular situation where the investments in media services and human
interaction do not reach very high levels because resources
are shared with the face to face courses.
Communication aspects are of great importance for all
HEIs. In fact, as the data show, the e-learning activities
of the Politecnico are well advertised and encourage the
creation and fostering of partnerships with national and
international institutions and companies.
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Figure 9: Politecnico di Milano indicators on learning and growth dimension (BSC)
As the data show, 2005 recorded the highest number of
events; this depends, in part, on the number of mentions
in the printed media. In 2006 the data show an increase
in the number of new projects, which reached 25. In 2006
there was a rise in Politecnico staff participation in national and international conferences, both as participants
and presenters.
four case studies. During our two years of work, several
things became clear. First, the total cost of e-learning activities in the university budget. For the most experienced
partner with more than 20 years of activity, the proportion
was 1 percent and for the least experienced it was less than
0.2 percent. Many people, including the members of WP3,
had perceived e-learning to be “very costly”. In terms of
the changes provided by ICT to learning activities, the financial implications for the universities studied were quite
small. And deeper analysis of the financial data reveals that
within a few years incomes exceed expenditure. Indeed, elearning becomes a profitable activity when the universities
involved develop external partnerships.
Other evidence comes from the analysis of the degrees
offered in terms of e-learning services. All the partners first
implemented or reoriented their strategic goals to WEL.
WEL has become a standard offering for students at one
institution. Before the structural changes were announced,
it seemed necessary to increase ICT-based equipment and
examine its use. However, the emphasis on WEL shows
that universities had some difficulty in developing fully
online degree courses with high levels of interaction and
media involvement. As we have shown, WEL consists of
the transformation of traditional lectures into a multimedia format. But the provision of full online degree courses,
of high quality, requires more than mere substitution or
transfer. It requires a change in didactics and an evolution
in teaching practices and learning processes (Garrett and
Jokiverta, 2004). Blended learning is marginal in our sample of universities, but there are certain actors that see it as
another path towards cultural change.
Although this study provides comparative data for
three European countries and four case studies, it has some
limitations. The BSC was clearly designed for HEI deci-
4. Conclusion and discussion
Among the participants in the workgroup, some have responsibilities for the management of e-learning activities
in their institutions and they had a first hand opportunity
to test the BSC approach during the last months of 2007.
Initial feedback is available. The period of experimentation
is too short to draw any firm conclusions on the use of
BSC, but it is interesting to make a preliminary analysis of
its impact on the management of HEIs, one of our original
goals. Susanna Sancassani, managing director of the Centre METID, Politecnico di Milano, experimented with it
for a board meeting and emphasized the following points:
“E-learning is a complex field which needs a ‘multifaceted’
approach for a good strategic comprehension: we discovered a
lot about ourselves! We are able now to show to stakeholders
(METID Scientific Committee, university decision makers
but also teachers and students) how, really, e-learning impacts
the life of the university. At least, it is important to personalize the model to a specific context by introducing or modifying single indicators” (Sancassani and Tomasini, 2007).
An extended version of the METID feedback will reveal success factors or initial hypotheses, by analysing the
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sion makers and to provide answers for management and
organization in university e-learning activities. It might be
considered rather bold to use this data set for comparison
and to describe e-learning development in HEIs. In order
to achieve a more coherent approach and the possibility of
extending the comparison, it will be necessary to develop
new tools. These tools should allow the conceptualization
of the trajectories of universities with the dual goal of identifying critical strengths in the progression of e-learning
activities in higher education systems, and designing strategies to inform and help institutions in the management
of e-learning activities. A preliminary report was presented
in Paris in December 2007, but has to be tested and developed. It needs to fully address questions such as: Are Virtual Campuses a good way to manage e-learning activities?
And, if so, what kinds of activities? (Stanfield, 2007).
A return to Kaplan and Norton’s (1997) proposition
would be useful. The BSC application should not be limited to a simple performance measurement of open and distance learning activities. As these authors affirm, “Balanced
Scorecard is management not measurement”. It is rooted
in a global concept of organization focused on strategic
aspects and therefore represents an ideal instrument to
move a complex organization, such as a university, forward
in the achievement of a collective vision and objective. This
approach should be generalized to all areas of HEI in order
to be coherent with higher education, research, continuing
education and e-learning, but this is a separate goal.
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Recommended citation
garrot, thierry; psillaki, maria; rochhia, sylvie (2008). “Describing E-learning Development in European
Higher Education Institutions Using a Balanced Scorecard”. In: “The Economics of E-learning” [online monograph].
Revista de Universidad y Sociedad del Conocimiento (RUSC). Vol. 5, no. 1. UOC. [Accessed: dd/mm/yy].
<http://www.uoc.edu/rusc/5/1/dt/eng/garrot_psillaki_rochhia.pdf>
This work is subject to a Creative Commons Attribution-Noncommercial-NoDerivativeWorks 2.5 Spain licence. It
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About the authors
Thierry Garrot
Associate Professor in Management, University of Nice Sophia Antipolis
[email protected]
Thierry Garrot is Associate Professor in Management, Institute of Business Administration, at the University
of Nice Sophia Antipolis. He has considerable experience in lifelong learning projects and e-Learning degrees.
For more than five years, he was the director of the Lifelong Learning Education Centre of his university. He
participates in the European eLene-EEwww1 project on the economics of e-learning and coordinates the workpackage on the indicators of e-Learning.
Maria Psillaki
Associate Professor of Economics, University of Nice Sophia Antipolis
[email protected]
Dr. Maria Psillaki is Associate Professor of Economics, University of Nice Sophia Antipolis (UNSA), GREDEGCNRS. She participates in the European eLene-EEwww1 project on the economics of e-learning.
Sylvie Rochhia
Associate Professor of Economics, University of Nice Sophia Antipolis
[email protected]
Dr. Sylvie Rochhıa is Associate Professor of Economics, University of Nice Sophia Antipolis (UNSA), GREDEGCNRS. She participates in the European eLene-EEwww1 project on the economics of e-learning. Director of the
Bachelor Economics & Management online undergraduate programme of CANEGEwww2 (numerical Campus)
since 2001, she has also been responsible for developing ICT at the faculty of Law, Economics and Management
since 2004, and a member of the UNT (numerical University) AUNEGEwww3 since 2005.
[www1] http://www.elene-ee.net
[www2] http://www.canege.org/accueil.htm
[www3] http://www.aunege.org
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Monograph “The Economics of E-learning”
article
Uses of Information and
Communication Technologies
in Europe’s Higher Education
Institutions: From Digital Divides
to Digital Trajectories*
Adel Ben Youssef (PhD)
Ludovic Ragni (PhD)
Submitted: February 2008
Accepted: February 2008
Published: April 2008
Abstract
This paper has two objectives, firstly, to identify the three basic levels of educational digital divides and to discuss
them in the context of the European Union, and secondly, to develop an alternative hypothesis for educational
digital trajectories instead of looking at educational divides.
Section one identifies the three levels of digital divides. The first level of educational digital divide concerns
differences in ICT equipment. We identify the sources and the mechanisms that help to bridge this divide (Market
Dynamics and Public Policies). Then, focussing on the second level of digital divide (usages divide) we analyse why
this seems to be the main problem nowadays in Europe. Finally, a third level of digital divide concerns the performance of ICT in education. We give some possible explanations for the productivity paradox which is observed in
European higher education.
Section two is devoted to the explanation of the diversity of usage of ICT between countries and universities.
ICT allows different contextualisation and adaptation to the local context. Universities are developing several
digital trajectories and instead of benchmarking universities we look at the explanations for this diversity. Two key
elements were explored here: competition strategy of universities and students’ attitudes towards the technologies.
Keywords
learning process, e-learning, productivity paradox, information and communication technologies, skill based technological change, digital divide
* This Work is partially funded by the European Commission, eLene-EE project. I would like to thank S, S & A for their support during
this work.
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JEL Classification: C 23, D24
Usos de las tecnologías de la información y de la comunicación en las instituciones de
enseñanza superior de Europa: De las brechas digitales a las trayectorias digitales
Resumen
Este estudio tiene dos objetivos; el primero es identificar los tres niveles básicos de brecha digital educativa y tratarlos en el contexto
de la Unión Europea y el segundo es desarrollar una hipótesis alternativa para las trayectorias digitales educativas en lugar de
fijarse en las brechas educativas.
La primera sección define los tres niveles de brechas digitales. El primer nivel de brecha digital educativa se refiere a las
diferencias en cuanto a equipamiento de TIC. Definimos las fuentes y los mecanismos que ayudan a cerrar esta brecha (dinámica
del mercado y política social). Después, centrándonos en el segundo nivel de brecha digital (la brecha de usos), analizamos por qué
este parece ser el principal problema en Europa hoy día. Finalmente, un tercer nivel de brecha digital hace referencia al rendimiento
de las TIC en la educación. Proponemos algunas explicaciones posibles sobre la paradoja de productividad que se observa en la
educación superior europea.
La segunda sección está dedicada a la explicación de la diversidad de usos de las TIC entre países y universidades. Las TIC
permiten una contextualización diferente y la adaptación al contexto local. Las universidades están desarrollando varias trayectorias
digitales y, en lugar de evaluar comparativamente las universidades, proponemos explicaciones para esta diversidad. Aquí se han
tratado dos elementos clave: la estrategia competitiva de las universidades y las actitudes de los estudiantes frente a las tecnologías.
Palabras clave
proceso de aprendizaje, e-learning, paradoja de la productividad, tecnologías de la información y de la comunicación, cambio
tecnológico basado en la habilidad, brecha digital
“Technology can just as easily worsen inequalities
as it can ameliorate them (Servon 2002)”
about the quality of learning, financial cost-reduction,
qualifications of students (future labour force), worldwide
competition of universities, etc. has led many governments
to take public initiatives in the field of e-learning and usage of ICT in higher education.
One of the key aspects of the debate is to identify
the inequalities caused by the usage of ICT in higher
education institutions. Policy makers fear that the rapid
technological change may not benefit all students and
may cause inequalities among students. Social inequalities are then amplified by e-exclusion even when people
reach higher education. During the last two decades,
wage inequalities have grown among workers in developed countries. The “Skill Biased Technological Change
Hypothesis” gives one of the most popular explanations.
Many authors argue that technological change is not
neutral and it may benefit some workers by giving them
more capabilities and competencies and therefore higher
salaries, however, the other workers are less able to use
these technologies and they are then less qualified and
subsequently their salaries decrease. Higher education
Introduction
A wide range (continuum) of digital pedagogical tools is available nowadays for teachers and students. They include computers, e-mail, electronic presentations, discussion rooms,
platforms, video-conferences, interactive white boards and
more. These new tools have different impacts on the learning process since they change its scope (new students, people all over the world, worldwide competition), its methods
(course size, learning events, online exercises, simulations,
auto-evaluation), and its sequencing (full time face-to-face,
full time online, blended learning, long-life learning).
To look at the impact of these developments within
the context of higher education means examining the ways
they challenge the 2500-year-old Socratic, face-to-face,
lecturing and discussion modes characterising most of college and university teaching (Nachamias, 2002). Concerns
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Uses of Information and Communication Technologies...
institutions are thought of as playing a significant role in
reducing this divide or amplifying it.
This paper has two objectives, firstly, to identify the
three basic levels of educational digital divides and to discuss them in the context of the European Union, and secondly, to develop an alternative hypothesis for educational
digital trajectories instead of looking at educational divides.
The first level of educational digital divide concerns differences in ICT equipment. We identify the sources and the
mechanisms that help to bridge this divide. Then, focussing on the second level of digital divide (usages divide) we
analyse why this seems to be the main problem nowadays
in Europe. Finally, a third level of digital divide concerns
the performance of ICT in education. We give some possible explanations for the productivity paradox which is
observed in European higher education. Section two is
devoted to the explanation of the diversity of usage of ICT
between countries and universities. ICT allows different contextualisation and adaptation to the local context.
Universities are developing several digital trajectories and
instead of benchmarking universities we look at the explanations for this diversity. Two key elements were explored
here: competition strategy of universities and students attitudes towards the technologies.
individuals and businesses to take advantage of the Internet
varies significantly across the OECD area as well between
OECD and non-member countries. Access to basic telecommunications infrastructures is fundamental to any consideration of the issue, as it precedes and is more widely available
than access to and use of the Internet.”
Here we looked at the digital divides among social
groups related to ICT and especially educational information and communication technology (EICT). Starting
from the logistic curve technologies’ diffusion we can separate three levels of digital divides depending on the stage
of diffusion.
The first level concerns the equipment and access to
EICT. The second level assumes that people have the same
level of equipment and looks at the sources of diverse use
of EICT. In the third level, we consider that the equipment
and usage rates are equivalent and we look at the performances of students and universities. We discuss each level
of these divides to explain their main determinants and to
examine certain implications for the European Union.
1.1. The first level of educational digital
divides: equipment
1. The three levels of educational
digital divides
Looking at the rapid diffusion of information and communication technologies in the higher education sector leads
to worries that the unequipped (by choice or by constraint)
face the risk of becoming more and more marginalised
from the economic and social point of view. Moreover,
economic literature mentions that a gap may separate
those who are well-equipped (Haves) from those who are
not (Have-nots). The implicit hypothesis behind this is that
individuals with ICT can benefit from better information,
education and particularly positive associated externalities.
The unequipped may have less wealth of information and
education and do not benefit from externalities related to
ICT (such as e-competences). Those who are equipped
find themselves within the rich networks of relations, skills,
knowledge and education, while those not connected risk
being excluded from these dynamics.
A great number of studies concerning the first level of
digital divide exist nowadays. At the microeconomic level,
income gaps between social groups are the main explanation of the digital divide (Quibria et al., 2002). At the
macroeconomic level the structure of infrastructure of telecommunications is considered the main reason (Wallsten,
2002, Fink, Mattoo and Rathindran, 2003).
Although, the concept of digital divide is very widely used,
it is poorly defined. It belongs to the category of concepts
which cannot be described by a unique or a universal definition. It reflects various facets of inequalities related to the
digitalisation of the economy and diffusion of information
and communication technologies (ICT). The concept of
the digital divide, sense, measurement and interpretation,
has been a focus of various academic research projects since
the end of the 1990s (Arquette, 2002; Scadias, 2002; Norris, 2001; EOCD, 2004; Corrocher and Ordanini, 2000;
Pohjola, 2002; Antonelli, 2003; Kozma et al. 2005)
The most generally accepted definition of digital divide
is given by the OECD (2001)
“The gap between individuals, households, business and geographic areas at different socio-economic levels with regard
both to their opportunities to access information and communication technologies (ICT) and to their use of Internet
for a wide variety of activities. The digital divide reflects various differences among and within countries. The ability of
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While this digital divide was at the heart of the debate
at the turn of the 21st century, two main dynamics have
reduced this significantly in recent years: public policies
and market dynamics.
Table 1 - Average number of students per computer, 2000 and
2003 (OECD, 2005)
Country
2000
2003
Norway
7
6
1.1.1. Strong public policies have reduced the digital
divide among higher education institutions
United Kingdom
8
4
Sweden
12
6
Since universities are key actors in the “Knowledge Based
Economy” a major effort was made in the last decade,
worldwide and especially in European countries, in order
to equip them with ICT (computers, Internet access, etc.).
It is more appropriate to qualify the equipment problem as
a delay of diffusion related to these technologies between
higher education institutions and not as a persistent gap.
However, differences in equipment at home are still observed among categories of students. Related to this first
point, it is important to distinguish between persistent inequalities and inequalities related to the diffusion of new
goods or services. The first level of digital divide has been
strongly reduced by public policies. However, the emergence of waves of new generations of the same technologies continues to exert a “pressure” on ICT equipment.
Italy
16
8
Spain
24
12
Germany
24
12
Finland
10
6
Portugal
74
14
Greece
58
12
1.2. The second level of digital divide: usages
If the problem of equipment (the first level of digital divide) is being solved, the question of usage becomes more
important. Many studies state that, “the potential of ICT
in higher education is not fully used” (UNESCO, 2003).
“The next challenge relates to the incentives for the teachers and the students to use the technological functionalities in an innovating and effective way (OECD, 2005: p.
14-15)”.
Universities, students and teachers do not have the
same intensity and objectives of usages. Time devoted
on the Internet varies from one student to another, and
students use these technologies for different goals. If we
restrict ourselves only to pedagogical aims, one can stress
the diversity of usages: communication with other students
or teachers, finding information concerning their courses,
collaborative learning and serious gaming. This diversity
and the intensity of usages of EICT are generally considered in economic literature as having two basic sources.
The first one relies on the educative strategies of the universities. They are exploring and exploiting a wide range of
services in order to create competitive advantages and in
order to have better returns of education. The second is due
to differences in students’ abilities and attitudes towards ecourses and more generally e-learning objects. Since these
elements are quite different from one country to another
one can expect differences in usages and in their intensity.
Determinants of usage of digital divides are mainly
time allocation, user skills and autonomy of use.
Intensity of use refers to the time devoted to online
activities. Since people are constrained by their available
time, they allocate it for different goals: work, training,
leisure, etc. The more students allocate their time to on-
1.1.2. Market dynamics have also reduced the digital
divide among students
The second element reducing the first level of digital divide
is the fact that telecommunications and ICT markets are
more and more competitive and since the 90’s prices have
been falling. According to Colecchia and Schereyer (2001),
the price fall was approximately 15% per year between
1995 and 2005. These market dynamics benefit consumers
who are increasingly better equipped. The more competitive the market is, the better equipped the universities and
students are.
These two dynamics seem to work well in the European Union and the first level of digital divide may be
considered now as a temporary problem. As an illustration,
the student per computer ratio is one of the most used indicators concerning ICT equipment in higher education.
In 1990, the students per computer ratios were approximately 30 in advanced institutions (UNESCO, 2003). Table 1 shows how market dynamics and public policies have
significantly reduced this ratio and are working to bridge
this divide. However, we must keep in mind that the rapid
technological changes may create new, more qualitative divides (bandwidth, broadband, storage possibilities, etc.).
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line education activities the more they renounce on work
(salaries), leisure or other usages. This allocation of time
is a fundamental dimension in explaining differences in
usage among students. The initial inequalities concerning
revenue exert a huge effect here. Students who are working full-time or part-time may have less time available for
online educative activities.
Using ICT efficiently in higher education is not
straightforward. Basic computer skills and more advanced
skills are needed for effective use. Differences are observed
among students and teachers in these skills. In a recent
publication, Ben Youssef et al. (2007) show clear digital divides in the ability of uses among higher education teachers in France.
Finally, equipment constraints may exert an effect on uses.
The autonomy of use refers to the availability of computers
and other technologies at home. This gives the user the ability
to use the technology whenever he or she wants. If we accept
that most higher education institutions nowadays offer access
to the Internet and to computers at school, there is still a huge
difference concerning access at home. This leads automatically
to differences in the intensity of usage.
Two basic problems related to usage of EICT in European universities need specific answers. First, the ability to
use these technologies varies from one student to another
and from one teacher to another. Awareness of the potential of these technologies must be increased. Second, usage
of EICT needs a basic learning process and training programmes nowadays do not seem to meet teachers’ needs.
ready-to-use tools in the education setting. The ability and
the preferences of teachers are fundamental concerning the
intensity of usage. Nowadays a variety of under-utilised
learning objects2 exist on the web. For example, in a recent
study, Sutherland (2004) points out that “the Oxford English Dictionary, online in English, and the graph-plotting
software in mathematics are among the free powerful pedagogical tools which are under-utilised”. The identification of
these tools and the increasing awareness of their potential
must be at the heart of future public policies. The whole
process of learning must be changed such that teachers take
the time to explore, with their students, the possibilities of
ICT usages in education.
1.2.2. Effective usage needs intensive workplace
training
Related to the above mentioned point, the digital divides
in European and OECD countries are more linked, to
some extent, to a lack of training activities for teachers and
staff within universities. ICT calls for intensive training
and the main problem is to understand how to implement
these training programmes. “The changes in workplaces
that were due to the introduction of new technologies and
of new workplace practices have highlighted the necessity
of acquiring new skills even after workers have completed
their formal education. One of the most common places
where workers acquire these new skills is in the workplace”. (Black and Lynch, 2003). Increasing the intensity
of uses needs specific policies for teachers, depending on
their initial skills and usages. For some of them (laggards)
hard and long training is needed in order to initiate them
in the potentials of these technologies.
1.2.1. Exploration-exploitation process of the
technology
Computers are powerful tools to mediate the learning process in higher education. Teachers use them in their relation
with their students. The development of online courses has
led many educators to re-examine their current approach,
whereas others have simply adapted their current approach.
Courses can thus vary from video lectures to studentcentred constructivist approaches with less guidance from
educators (Weller, 2003). This variety of approaches reflects
the exploration-exploitation process induced by ICT. Any
use of technology needs an adaptation by the teacher to its
specific uses and teachers prefer their own tools to all other
1.3. The third level of digital divides:
performances
We may have a high level of ICT equipment without any
economic or pedagogical impact on the higher education
sector. The productivity paradox described by Solow3 seems
to be effective in the higher education sector. In other words,
for two decades, the accumulation of ICT in the higher education sector in most European countries has been very im-
1. Related to SCORM (one of the organisations driving learning object standards), a learning object is defined as “a portion of a course packaged
with sufficient information to be reusable, accessible, interoperable, and durable”. WELLER (2003) suggests that a learning object is any piece of
educational material that addresses one learning outcome.
2. For an extensive discussion of the Productivity Paradox see SHARPE (2004)
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portant. Most of the teachers are connected in their workplace and even at home. Similarly, most of the students, even
within the face-to-face learning process, are connected and
use computers and the Internet. But is there any change in
the learning process? Do we have better results or returns?
Table 2 shows that the productivity of higher education in most European countries is falling. Productivity is
calculated by the standard input/output analysis.
while others not. Brown & Liedholm (2002) have studied the
performance of students in Microeconomics at the Michigan
state University in three different modes (live, hybrid and virtual). They found that students in virtual classes, while having
better characteristics, performed significantly worse in exams
than students in face-to-face classes.
From the job market perspective, the debate seems
clearer. Since with intensive usage of ICT e-competence
is acquired, more advanced users among students may have
two outcomes (e-competencies and their degrees). There is
extensive literature on the effects of ICT on workers’ skills
(Acemoglu, 1998; Caroli E., Van Reenen, 2001; Autor et
al. 2003; Hempel, 2004; Autor et al. 2005), with the ICT
bonus apparently effective in the job market.
The European Union is building a strategy to cover the
shortage of e-skilled workers that the European Union will
face in the next decades, which means that the usage of
ICT in higher education is becoming increasingly necessary, at the very least for acquiring these skills. The digital
divide in performance will become a divide in future salaries. The link between the introduction of ICT in higher
education and the Skill Biased Technological Change is
then easy to understand from this perspective.
The “higher education productivity paradox” needs further
research at the theoretical and empirical levels. Two explanations may be valid here; the first is that, while technological
change is important in the higher education sector, there is
a need for complementary innovations and organisational
change in order to achieve better returns, the second one is
that technological change needs to reconsider the incentives
for teachers to use these technologies more intensively.
Table 2 – Productivity growth in higher education in Europe
(2005)
Country
2000
Norway
+4%
United Kingdom
+4%
Hungary
+8%
Austria
-9%
Denmark
-24%
France
-13%
Spain
-33%
Germany
-11%
Italy
-20%
Greece
-31%
Higher education may be evaluated for its performances
in different ways. At least four outcomes may be distinguished: (i) student achievements, (ii) competencies and human capital, (iii) innovation and knowledge generation and
(iv) other externalities such as security and less crime. We
restrict ourselves in this paper to the two first outcomes.
From the perspective of student achievement, the debate
shows contradictory results. While some literature shows
a positive relationship between the use of ICT and student
performance, other studies suggest little impact. For example,
in recent research, specific to the United States, Sosin et al.
(2004) constructed a database of 67 sections of 3,986 students
enrolling for introductory economics, taught by 30 instructors
in 15 institutions during the spring and fall terms of 2002.
They found significant, but small, positive impact on student
performance due to ICT use. But they show that some technologies seems to be positively correlated to the performance
1.2.3. The lack of adoption of organisational change in
the higher education sector
Economic literature has shown that technological change,
alone, does not lead to any change in economic performance.3 There is a need for rethinking the organisation4 and
use of organisational innovations. The uses of ICT need
more flexible models of organisation. Few studies have tried
to examine this dimension in the higher education sector.
3. Several studies present evidence on the link between ICT and new work practices (Bresnahan et al. 2002, Black and Lynch, 2001; Greenan and Mairesse,
2003 & 2004).
4. Organisation is defined as the way decision-making units are structured within an institution (firms, universities etc.), the way decision-making power and
skills are distributed and the type of information and communication structures in place. Thus any change in the distribution of power, skills, and information,
or in lines of communication constitutes an organisational change (Sah and Stiglitz, 1986). From an evolutionist perspective (Nelson and Winter, 1982)
organisational change is a change in the routine that the universities operate.
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In the European context, while students and teachers are
using these technologies more and more intensively, the
change in the organisational side seems to be very weak.
This lack of organisational change may, as different studies
have explained, lead to a negative productivity as shown
in Table 2. It is better to use the old methods with the old
technologies and new technologies with new organisational innovations.5 The shift must follow two directions as the
complementarities hypothesis suggests. Perhaps, the most
important training topic is how to use new organisational
designs in higher education. Several methods are available
such as learning teams but few training programmes are
implemented to show higher education teachers how to
use them. E-education is more linked to new organisational
designs than to new technology uses. This may explain the
contradictory results obtained concerning the link between
the use of ICT and performance.
deal more with the concept of digital trajectories and less
with digital divides. Information and communications
technologies are widely accepted as general purposes
technologies (GPTs) (Bresnahan and Trajtenberg, 1995).
They need to be adapted to the local environment and
to local constraints (Antonelli, 2003). Starting from this
point of view higher education institutions may have
different digital trajectories in using these technologies. Thus, understanding the diversity of usages and the
models of usages is at the heart of research. Institutions
and students may use these technologies differently but
in the end achieve the same goals. There is no dominant
strategy. All mixed strategies are available for HEI and
each of them can develop a model with different level of
usage intensity. Among different factors contributing to
the diversity of usages, we restrict ourselves here to two
main explanations.
Firstly, universities use ICT in order to create competitive advantages in worldwide competition. Secondly,
students’ abilities and innovations differ from one country
to another and from one university to another. These elements may explain why we are observing a diversity of
strategies.
1.2.4. Effective ICT use needs a change in incentives
The lack of change in the higher education sector may be
explained by the relative lack of change in incentives and
rewards. For example, the evaluation of higher education
teachers is still based only upon “scientific” criteria such as
how many articles and books, and in what journal, teachers
have published. This does not give a teacher the incentive to
invest in new pedagogical tools, in a learning process using
ICT in teaching, etc. Certainly, the environmental pressure
(students, colleague, and staff ) can lead to some motivation
to use the new technologies, but for better performance
from the use of ICT, since it changes the allocation of the
available time, one must reconsider the incentives and the
rewards. All kinds of incentives must be revised, monetary
and non-monetary incentives.
2.1. Universities as a provider of e-services
The higher education sector is becoming more and more
competitive. Universities seem to be in competition to
attract talented students and lecturers. These dynamics
have an impact on their proposed e-services. Quality of
education and better returns on the diploma were the first
elements to be considered. E-services provided by universities seek to create a “product differentiation” in a more
competitive market (free entry market). At the same time,
ICT help universities to give more personalised services
and to take into account the differences between students.
The quality of education is increasing with the use of these
technologies.
2. From digital divides to digital
trajectories: explaining the
differences
2.1.1. Competition among universities and ICT uses
The main problem with the digital divides hypotheses
is the fact that they assess the impacts of ICT as homogenous such that countries, regions, individuals and
business can be benchmarked. But recent publications
E-Learning services is an emerging and fast growing market and perhaps one of the most dynamic markets in the
near future.
5. Greenan and Mairesse (2004) give more detailed explanation on this hypothesis.
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“There is a rush by universities, dotcoms, and corporations to
develop online courses, virtual campuses, education portals,
and courseware. The drive to develop a winning formula for
commercial online education has fostered partnerships, as
‘Internet entrepreneurs, textbook publishers, venture capitalists, corporate raiders, and junk-bond kings’ look to education
to drive the next wave of e-commerce” (Bianchi, 2000).
Table 4: Innovative usages of ICT
Advanced e-services – Innovative uses
Podcasting
Usage of collaborative platforms
E-Learning 2.0 (social capital and social interactions)
Web access to courses
Online exams
Universities are competing worldwide. They are trying
to attract the best students and professors worldwide. By
creating knowledge, by creating innovative patents, training
the “knowledge workers”, diffusion of culture, etc. they are
considered the key actors in the knowledge based economy.
Since they are in competition, the usage of ICT was viewed
in the early 90s as a means of creating competitive advantages. They were engaged in hard policies for equipment and
e-services production. In some ranking of universities, the
equipment criteria are highly considered. As later adopters
were equipped, creating competitive advantage within the
university is more closely linked to efficient use of the technology rather than the equipment itself.
Two stages characterise this race by universities to
deliver e-services. The first corresponds to the situation
where the quick change of technologies allowed a major
differentiation of the services proposed by universities.
This stage corresponds to an earlier period of the Internet
and its associated technologies. For example, e-learning
was perceived as a tool of differentiation of universities
aiming at reaching students worldwide. This strategy of
offering these services to the students by the more competitive universities rapidly became a common strategy for
the whole university sector. The usage of Internet becomes
very common in European universities and most of them
offer many standardised services. Many universities offer
free online courses and access to many resources. To some
extent, this standardisation process leads to a package of
services offered freely by all universities.
Serious Gaming as pedagogical tool
Network of universities sharing common best practices
E-resources
E-skills oriented programmes
E-governance of universities (E-vote for examp le)
This technological race for delivering e-services
through innovative ICT generates a new concept of delivering education services through different channels: The
multi-channels business model. Since the channels of delivering education services could not by themselves generate competitive advantages, universities reconsidered their
strategies and tried to offer more advanced services based
on these new technologies.
These dynamics were facilitated by the emergence of
a wide range of new applications (Podcasts, Wiki, Blogs,
Tagging, etc.) called Web 2.0. This process requires huge
resources for universities and a change in their organisation and their business models. Here, the institutional diversity of European countries towards universities and the
way of delivering diplomas led to a great diversity of usage
of ICT.
This race was not observed in all European countries.
Countries where the competition is intensive and where
universities are seeking to compete for the worldwide market are more likely to adopt innovative usages and innovative services proposed by their universities.
2.1.2. From mass education to discrimination and
personalised learning
Table 3: Standard usages of ICT in European countries
Basic e-services – Standard
Free access to computers
A second element characterises the new forms of e-services and affects the innovative usages of ICT by universities. Universities seek to personalise their services for their
students and offer courses in different formats. This was
made possible thanks to the multiplicity of the channels of
distribution and the tractability of the interactions among
students and among students and teachers.
The supply of university services was verticalised and
personalised. The Internet allows universities to offer high
Free access to Internet
Free access to software
Online access to virtual library
Free access to virtual resources
Online e-administration of students
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value services, not linked to geographical proximity. These
discrimination strategies seem to be satisfying for both the
universities and the students. Students have exactly what
they need and universities are catching more students by
less means, and benefit from a scale economy. But these
dynamics are not observed in all European countries.
Many countries have a centralised governance system of
universities that prevents changes from being made locally. A non-discriminatory argument among students is
invoked to explain why universities, while they are aware
of the values, do not use these possibilities fully.
The intensity of competition between universities is increasing and the contestability (free entry) of the markets
was accelerated by the generalisation of new uses related to
ICT. The diversification of services and the personalisation
of the student-teacher relationships also allow universities
to exploit the virtues of price discrimination. These dynamics are creating a variety of models in the European
Union.
new usages and services among countries. However, since
many universities replicate the best practices from the first
adopters they implement only stabilised e-services and so
avoid the no-satisfaction risk.
The second element is related to the spatial interdependence between preferences. Students are subject to
imitation and contagious effects regarding education, and
even consumer goods. As experimental goods, these new
services imply that the students agree to support costs of
training associated with their use. It is only if the effects of
imitation and interdependence between consumers prove
to be sufficient in terms of positive externalities that these
new services are adopted. The costs of training are assumed
to be the switching costs. Students adopt the new services
if the switching costs are low and the perceived value is
high. This process of learning follows different patterns
from one country to another. It depends on the collective
learning by economic agents and the depth of the networks
effects, clubs, and virtual communities, etc.
2.2. The role of students in the development
of innovative usages
2.2.2. Innovations of students as determinant of the
digital trajectory
Collective preferences imply that the development of
e-services must take into account the specific student’s
choices in each country. At least two elements characterise
the diversity of these preferences. The first relates to the
student’s experience when it is a question of appreciating
e-services that constitute experiment goods. The second,
very close to the first one, relates to the innovation of students regarding the new education services.
Since the seminal work of Rogers (1995), people’s innovation is considered as an important dimension concerning ICT in general. People are more or less receptive to
new technologies and new ideas. Rogers states that earlier
adopters play a key role in the development of these technologies and in the process of maturation of these technologies in a way that they respond to their needs. Rogers
(1995) suggests a classification of five types of adopters:
(1) innovators, (2) early adopters, (3) early majority, (2) late
majority and (5) laggards.
Using this as a base, it is obvious that the composition of these sub groups is quite different from one country
to another and from one university to another. Countries
where innovator students are a large group develop the
most technologically advanced applications and services
compared with countries where late majority or laggards
dominate. This is not a question of adoption of new technologies, it is more about adaptation of technologies to the
innovativeness of students. Agarwal and Prasad, (1998)
state that innovativeness of consumers, as “the willingness
of an individual to try out any new information technology”, is an important dimension of information technologies.
This innovation has found its tools by the development
of what we call the collaborative Web or Web 2.0. On one
hand, interactions among innovative students are growing
2.2.1. Student preferences and digital trajectories
Life styles greatly influence the relation between universities and students. Indeed, since the students’ and teachers’
choices diverge from one country to another, they affect
the uses in education. These differences are expressed in at
least two ways.
Intensity of use depends on the first use experience,
which is a crucial moment in the process. The main issue
here is that the launch of a new usage or service must avoid
the risks of dissatisfaction with technology (Meuter et al.,
2000; Joseph et al., 1999). The confidence relationships and
trust may be modified at this moment. It is important that
students find the applications and technologies secure and
satisfying from the first use, or they will not adopt them.
This may explain the differences in the adoption process of
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rapidly and this implies disparities concerning uses among
countries and universities. On the other hand, the interaction between students as innovators and teachers is defining the new e-services. Since the intensity of interactions is
quite different from one country to another, the e-services
are expected to be different.
In the end, the impact of new technologies often depends on historical factors and the cumulative capabilities
of students and teachers to support a learning process.
These learning processes are very different from one country to another. This role of the students is becoming more
and more important. Since the emergence of the participative web and the so-called e-Learning 2.0, students are
becoming more and more active in the definition of the
contents of the Internet.
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autor, d.; katz, l.; kearney, m. (2005). “Trends in U.S
Wage Inequality: Re-Assessing the Revisionists”.
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Exploration”. Quarterly Journal of Economics. Vol. 118,
no. 4, pp. 1279.
ayres, r. u; williams, e. (2004). “The Digital Economy:
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Conclusion
In this paper we have tried to understand the basic dimensions of EICT digital divide and to explain their implications in European higher education institutions. Our main
findings are that, after a decade of equipment strategy, there
is a need nowadays to implement an efficient use strategy.
As ICT has an impact on the whole learning process, we
need a holistic approach to the changes. The productivity
paradox implies that the learning process must take into
account the organisational changes and the incentives
problem to have better returns in terms of teacher quality,
student achievement, and the quality of the labour force.
At the same time, since the main changes are qualitative,
we must understand these changes and quantify them before looking for any specific policies.
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Recommended citation
ben youssef, adel; ragni, ludovic (2008). “Uses of Information and Communication Technologies in Europe’s
Higher Education Institutions: From Digital Divides to Digital Trajectories”. In: “The Economics of E-learning”
[online monograph]. Revista de Universidad y Sociedad del Conocimiento (RUSC). Vol. 5, no. 1. UOC. [Accessed: dd/
mm/yy].
<http://www.uoc.edu/rusc/5/1/dt/eng/benyoussef_ragni.pdf>
issn 1698-580X
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About the authors
Adel Ben Youssef (PhD)
Assistant Professor at the University Paris Sud
[email protected]
Dr. Adel Ben Youssef is Assistant Professor at the University Paris Sud (Paris 11). He is responsible for the European
Markets and Firms Strategies Master’s. His research interests and areas of expertise include: digital divides, ICT
economic performances, E-learning, Eco-labelling, European integration, Euro-Mediterranean integration process.
He is the author of 30 publications related to his research interests. He is currently coordinating a special issue of
Reseaux on European Educational Digital Trajectories.
Ludovic Ragni (PhD)
Assistant Professor at the University of Nice Sophia Antipolis
Dr. Ludovic Ragni is an Assistant Professor at the University of Nice Sophia Antipolis. He is responsible for the
Economics of Human Resources Master’s. His research interests and areas of expertise include: ICT economic
performances, history of economic thought, strategic environmental policies, clusters and regional innovation. He
is the author of 50 publications related to his research interests.
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Créditos
La Revista de Universidad y Sociedad del Conocimiento (RUSC) es una publicación electrónica impulsada por la Cátedra
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(Cátedra CISCO de e-learning, Southen Alberta Institute of Technology, EE.UU.), Julio Cabero (Universidad de Sevilla,
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