A Spatial Economic Perspective on Higher Education Choices

John Cullinan and Brendan Halpin


Adopting a spatial perspective is now understood to be increasingly relevant for our understanding of a range of economic phenomena, including issues relating to international trade, regional development, population migration, clustering of economic activity and many other important questions in urban and regional economics. Indeed, the importance of geography in considering topics in these areas has been highlighted in both theoretical and empirical work. For example, in ‘economic geography’, the study of the location, distribution and spatial organisation of economic activities across the world, the work of Paul

J. Cullinan (*)

School of Business & Economics, National University of Ireland, Galway, Galway, Ireland

B. Halpin

Department of Sociology, University of Limerick, Limerick, Ireland © The Author(s) 2017

J. Cullinan, D. Flannery (eds.), Economic Insights on Higher Education Policy in Ireland, DOI 10.1007/978-3-319-48553-9_3

Krugman has helped add a significant new dimension to our theoretical understanding of the relationship between geography and trade, leading to a vast new literature dubbed the ‘new economic geography’ (Krugman 1991). Empirical analysis of spatial economic issues has also flourished with the increasingly widespread availability of geographically referenced data and geographic information systems (GIS) software packages, which have greatly facilitated more robust spatial analysis. There have also been notable developments, both theoretical and computational, in the subfield of spatial econometrics, allowing us to much better understand and address issues relating to spatial dependence and spatial heterogeneity in economic relationships, for example.

While the original focus of spatial economics1 was on issues relating to broad and traditional economic questions, increasingly there is now a focus on spatial economic issues in more specific sectors, such as health, agriculture, housing and so on. The education sector, and the higher education sector in particular, is no different. Indeed, given the nonuniform spatial distribution of higher education institutions (HEIs) in most countries, a number of researchers have started to focus on the role of geography in shaping a range of higher education choices (Abreu et al. 2014). These decisions include, from an individual’s perspective, whether to proceed to higher education or not, as well as choices relating to where and what to study. As this chapter will show for Irish school leavers, these decisions are heavily influenced by spatial considerations.

One likely reason for the importance of geography in this context is the ‘transaction cost argument’, which implies that the greater the travel distance to a HEI, the higher the transaction costs of higher education and the lower the associated probability of participation (Spiess and Wrohlich 2010). The authors outline a range of transaction costs that could influence school leavers, including direct financial costs such as commuting costs, search costs such as finding a place to live, indirect financial costs relating to forgone economies of scale associated with living at home, information costs associated with obtaining knowledge about different HEIs, as well as potential emotional costs associated with leaving home. It is also possible that so-called neighbourhood effects might play a role (Spiess and Wrohlich 2010). For example, the presence of a local university may generate ‘spillover effects’ that influence the behaviour of young people living in the vicinity of a HEI and make them more likely to proceed to higher education. Furthermore, there may also be ‘information network effects’, such that information about higher education could be more readily available in communities that are located closer to HEIs and that this could impact on decisions. Overall the basic argument is that students who live closer to a HEI may be more likely to participate in higher education (Cullinan et al. 2013).

Spatial analysis of higher education related decisions is not confined just to individuals however. For example, national or regional policymakers are likely to benefit from spatial economic analysis of choices related to choosing the optimal location of a new HEI or, as is currently the case in Ireland,2 decisions relating to amalgamations and consolidations of HEIs (see Chap. 1 for details). In terms of regional economic analysis, quantifying the economic impact of a HEI in its local region is also important (see Chap. 8 for an example of how to estimate regional multipliers for HEIs). In fact, according to Abreu et al. (2014, p. 350), “there is now a substantial literature on the direct links between universities and the [local] business environment” with “the biggest and most consistent influence of HEIs on local economies [being] the production of yearly cohorts of graduates who subsequently enter the labour market”.

This chapter considers the geography of higher education in Ireland, focussing on its relevance to school leavers for a range of decisions relating to higher education participation. More specifically, its main aim is to assess whether the spatial distribution and geographic accessibility of higher education has an (adverse) impact on higher education participation decisions. It does so by first employing cluster analysis and a range of innovative data visualisation techniques to identify and illustrate important patterns of transitions to higher education. It then utilises GIS techniques to illustrate the extent of geographic inequalities in higher education accessibility. The implications of these inequalities for higher education participation decisions are then discussed with reference to a number of recent Irish studies that have specifically considered the spatial economics of higher education participation. The final section concludes with some recommendations relating to reforming the student maintenance grant system.

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