On the Characteristics of the Demand for On-line Higher Education*

Transcription

1 Studi e Note di Economia, Anno XIV, n , pagg GruppoMontepaschi On the Characteristics of the Demand for On-line Higher Education* MARIO ALLEGRA**, GIOVANNI FULANTELLI***, VITO PIPITONE**** Despite the growth of e-learning, in Italy the number of students enrolling in university on line courses still remains very low. In this paper we report on the methodology and the results of a survey carried out at the Institute for Educational Technology of the Italian National Research Council, involving 1100 students in the final year of secondary school. The investigation was aimed at analysing how high school pupils perceive e-learning, how many of them really consider on line courses a valid choice for their university study and the reasons of their vision. (J.E.L.: I21) Introduction How do high school pupils view on-line degree courses? How many students really consider choosing one of these courses? These are a couple of the questions which the present paper will try to answer in order to understand the real growth potential of the market for on-line university education. The laboratory used for this analysis is Italy, a country which has experienced a radical upheaval of its university system over the past ten years, and in which e-learning is a rapidly developing phenomenon. The spread of new educational methodologies using ICT (Information and Communication Technology) has developed in Italy through a bottom-up type of process, often the result of the innovating initiatives of individual teachers. A more widespread use of new technologies in education has been impeded by cultural resistance by considerable number of Italian teachers who have to some extent refused to accept the integration of traditional teaching methods and new technologies. This refusal is probably due to the relatively static situation which for * Paper accepted in June ** Italian National Research Council, Institute for Educational Technologies, Italy; allegra@itd.cnr.it *** Italian National Research Council, Institute for Educational Technologies, Italy; fulantelli@itd.cnr.it **** Italian National Research Council, Institute for Coastal Marine Environment, Italy; vito.pipitone@cnr.it Corresponding author: Vito Pipitone.

2 68 Studi e Note di Economia, Anno XIV, n decades saw teachers adopting the same unchanging teaching methods. It is only in the last few years that a serious rationalisation of the episodic nature of e-learning activities has taken place with two out of three universities today having an e-learning policy (Fondazione CRUI 2006). Now that the cultural resistance to the use of new educational technologies has diminished, Italian universities are turning their attention to new problems, such as the search for new financial resources to create and offer teaching modules on the web, the protection of intellectual property of educational on-line material, the definition of a new relationship between technology and pedagogy, and the setting up of societies involving the world of production. Meanwhile, at a technological level, there is a rapid diffusion of university e-learning centres using technological platforms which are either open source or developed on site, and so better able to meet specific local needs (Liscia, 2005). The dynamic growth which has taken place in Italian universities may appear excessive when one considers the number of actual on-line students is no more than 5% of the total number of students enrolled (Fondazione CRUI 2006). At present, the use of the web and modern digital technologies seems to be directed more to improving the quality of traditional teaching situations rather than to attracting new kinds of student (for example workers, the disabled, pensioners etc). Thus, while on the one hand, e-learning in Italy is expected to grow since there are large sections of the population which, in the medium term, could enrol in distance learning courses, on the other hand we need to consider why the current demand for such courses is still so restricted. Our challenge in this paper is to try to understand the causes of a certain persistent resistance in adapting to the new technological context of the demand for higher education in Italy. To achieve our aim, let us start from the decision making process of students choosing whether or not to go to university and the role that information and previous educational experience play in this process. We will draw a theoretical picture of the problem, analysing empirical evidence in Italy. We then present the methodology used in our investigation and describe the basic characteristics of the sample used. Afterwards we present the results of the survey and put forward some considerations about the Italian case. Finally, we draw some general conclusions. Between theory and evidence: the Italian laboratory According to human capital theory (Campbell and Siegel 1967; Mincer 1974; Becker 1975), people consider education as an investment in human capital. The investment is attractive if the value of the expected benefits exceeds the costs of education. The expected benefits are typically expressed in terms of wage premium connected with the education program, whereas the costs are a broad and loosely defined category including tuition fees,

3 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand additional living costs, books and supplies, additional transportation costs and forfeited labour market earnings (the opportunity cost). Jackson and Weathersby (1975) evaluated seven studies that followed Ostheimer s (1953) pioneering work of estimating higher education demand among potential enrolees. Results showed that the cost to the student is a significant variable with negative impact but the magnitude of the price effect (refers to the tuition fees) was found to be relatively small, ranging from 0.06 to 1.9 percentage points change in the enrolment ratio for each 100 dollars increase in tuition price. Moreover, the absolute magnitude of the price responsiveness decreases with increasing income. In other words, individuals from low-income families are more affected by price changes than are individuals from highincome families. These findings received broad support in the international literature (Funk 1972; Ghali et al. 1977; Kim 1988; Paulse 1988; Savoca 1990; Heller 1997), though it should be noted that international comparison of price elasticity is hampered because of substantial variation in tuition fee levels and tuition fee determined systems. Recent econometric results confirm that students are not responsive to tuition fees and suggest that per capita income, financial support, wage premium and family background are important in the enrolment decision (Dynarski 1999; Paulsen and St. John 2002; Canton and De Jong 2005). The average income in society can influence the demand for higher education when education has a consumptive value. This predicts a positive correlation between university enrolment and per capita income. Besides, financial aid to students reduces the price of attendance and can affect enrolment decisions. Grants lower the net private contribution to the education investment and thereby raise the expected private return from schooling. It should be noted, however, that the student support system could affect study duration. Generous student support potentially increases study duration, due to moral hazard and adverse selection (Belot, Canton and Webbink 2004). It has been also argued that teenagers use information on the current wage gap between recent university and high school graduates to gauge the size of their own expected returns from schooling (Topel 1997; Card and Lemieux 2000). Secondary school graduates are encouraged to enrol at a university when the expected returns from a university program are higher. Finally, another factor with the potential of affecting both educational attainment and school returns is family background. Sacerdote (2002) finds that being raised in a family with high socioeconomic status greatly increases the probability of attending college. The analysis of the Italian situation supports the above findings. In fact, since 2000/01 the organization of university courses has been reformed: a binary one-tier system, characterized by a single educational level with two parallel paths (degree courses and university diplomas) has been replaced by a two-tier system, consisting of a single path on two levels. At the same time,

4 70 Studi e Note di Economia, Anno XIV, n greater didactic autonomy has been introduced in individual universities, allowing for the definition of new courses, methodologies and technologies to be adopted. In the years since the reform was introduced, in , the number of newly enrolled students has already increased by over 11% despite a demographic fall of 12% in the number of nineteen-year-olds; the number of students dropping out of university has fallen from 70% to 35%; and the number of students enrolled but not actively studying has also decreased markedly (Tosi 2005). In this same period, universities have begun to experiment and set up e- learning courses. As a recent study (Pipitone, Fulantelli and Allegra 2005) has highlighted, in only four years from the beginning of the reform, the number of active on line first level degree courses increased from 4 to 73. In a university system like the Italian one, in which the offer of residential places is sufficient for only 2% of students studying away from home (Tosi 2005), compared to 10% in France and Germany and 20% in Sweden, distance learning courses should have had a significant influence on demand, favouring in particular those living in outlying areas who are especially sensitive to additional living costs. Mature students should also have been attracted by the flexibility guaranteed by distance education and, in particular, by a large reduction in opportunity costs. As the experience of the Open University has shown (today it is the biggest university in Great Britain with more than 200,000 students), ICT applied to education is an effective tool for reconciling job requirements and the needs for continuous training. New technologies leave students free to choose the time and place of their education. Despite the cost reduction of university education, due to the growth of the e-learning supply, the number of students enrolling in university on line courses still remains very low. Before asking whether the theory of human capital fails to explain the growth in the demand for e-learning in Italy, it is important to verify whether all the hypotheses underlying the rational choices are confirmed. Do all potential university students know about the e-learning option before making their choice, and do they have the necessary information for evaluating this option? To answer these questions, we carried out a survey among final year students at Italian high schools concerning their knowledge and perception of e-learning. The survey The survey was administered using a web based questionnaire to a representative sample of 1100 students in the final year of secondary school, distributed in 20 Italian provinces. It was a closed answer questionnaire. Students were contacted by means of head teachers and computer science teachers, who were asked to monitor the survey activities.

5 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand The cities involved are from all the different geographical areas of the country (Bergamo, Milano, Padova, Parma, Piacenza and Torino in the North; Cagliari, Firenze, Latina, Roma and Terni in the Center; Avellino, Catania, Cosenza, Lecce, Messina, Napoli, Palermo, Potenza and Trapani in the South), and present wide cultural and economic differences. The North, in fact, represents the most advanced economic area of the country, while the South is more economically backward, with different infrastructures and behavioural models. The Centre obviously lies in an intermediate position. The sample was composed of 49.7% males and 50.3% females. 82.5% were between 18 and 19 years old, whilst 8.9% were 17 years old, with the remaining percentage over % of the sample attend scientific high schools, 23.6% commercial-technical schools, 15.6 % classical schools, 5.5% industrial-technical schools, 5.1% professional schools, 4.9% linguistic schools and the remaining percentage other high schools. The questionnaire was divided into five parts, with the objective of measuring: a) interest in university education in general; b) level of students willingness to move to another place; c) knowledge about e-learning and the evaluation of its advantages and risks; the questionnaire was also aimed at collecting: d) socio economic data about students and e) information about the courses that they had chosen (if they had already made a choice). The results Demand for university education and willingness to relocate The first part of the questionnaire aimed to analyse students intentions to continue their studies after high school; this was followed by some questions related to the possibility of attending universities away from home and the reasons for this. The first question concerned students wishes to enrol at university; 83.8 % of the sample expressed a desire to go on with their studies; in particular 59.5% of the students were certain to enrol while 24.3% considered it probable. It should be immediately noted that the percentage of positive answers obtained from the sample is consistent with the official ratio between the number of newly enrolled first-year university students and the number of final-year high-school students who obtain a diploma. There are no significant differences in the answers between students from the north, the centre and the south of Italy, despite the socio-cultural and economic diversity amongst these three areas of Italy. We then asked students who are not interested in going to university (i.e % of the whole sample) the reasons for this; the most important reason given was the wish to start work (corresponding to 57.3% of the replies) or, at least, to have a temporary work experience (13.5%), while financial reasons (indicated by 3.4%) seem to play little part in the choice to study at university. It is also interesting to notice that 60.1 % of the students who will enrol in

6 72 Studi e Note di Economia, Anno XIV, n university courses (both certain and probable) expected to attend all classes, 27.7% only some classes, 12% have not yet decided, while only 0.2% of those interviewed did not expect to attend any classes. A more detailed analysis of these data shows that the students who will probably enrol at university are less likely to attend all the classes than students who are certain to go on with their studies (39.7 % v. 68.4%). Consequently, the percentage expressing their wish to attend only some classes is significantly higher (37.1% v 23.8%). In answer to the question concerning students intentions to enrol in a degree course in the area where they live, 51.5% students replied positively, 14.6% expected to enrol in another area, but still in the region where they live, and 16.9% expected to move to another region. Of course, we find a higher percentage of students who do not yet know among those who consider university enrolment probable but not certain (more than 25%), and a higher percentage of students who consider attending a degree course in the area where they live among students who will certainly enrol at university (54.4% v. 44.6%). We also observe that a significantly lower percentage of students in the south of Italy answered yes compared to students in the north (38% v. 54%), and, since universities are equally distributed throughout Italy, the reason is not because there are fewer universities in the south. An analysis of the answers to questions related to the reasons which lead students to enrol at a university away from home shows that 48.7 % reply because the degree course of my choice is not available here, 22.8% want to have an experience away from home, 19.1% state that they are interested in the prestige of the university and, finally, 9.4% have other reasons. In this case there are also significant differences between the north, the centre and the south of Italy: the number of students wishing to have an experience away from home is considerably higher in southern parts of Italy compared to the north and the centre (32% v. 19% and 11%), and students looking for more prestigious universities in other areas are 23% in the south, 16% in the centre and 16% in the north. It seems evident from the answers to this part of the questionnaire that most of the final year high school students consider it almost natural to continue their studies, while a small percentage expect to enter the work place immediately. This choice does not seem to be conditioned by the financial position of the family, while there are significant differences in the various areas of the country. Furthermore, students in the north and in the south of Italy have different attitudes about moving to another area or region to study. Knowledge about e-learning In the second part of the questionnaire we tried to evaluate the level of knowledge of e-learning, the individual wish to enrol in on-line courses and, finally, the factors that could influence the choice of distance learning solu-

7 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand tions. In answer to the question Do you know what distance learning, commonly called e-learning, is? only 27.7% of the sample answered yes. It is immediately clear that there is a general lack of knowledge about e- learning, that could threaten the growth of the e-learning market in Italy. In addition, this limited knowledge of e-learning is not based on practical experience (only 2.1% of the whole sample has enrolled in a distance course). According to our hypotheses, we expected this result, and the questionnaire already included a brief description of e-learning: by e-learning we mean a method of education which is different from the traditional one, based on classroom lessons with teachers. In distance learning instead, teachers and students communicate mostly on the Internet using web sites and . The lessons and all the teaching materials are provided by the Internet or other multimedia tools (TV, DVD, etc). The presentation of the concept, as well as the style and language used to illustrate it, was not based on scientificallyoriented definitions found in the literature, but rather intended to give students an immediate idea of the concept of e-learning. It should be noted that the definition was also clarified in class by the teachers and experts supervising the administration of the questionnaire. This step was necessary in order to make students aware of e-learning and continue with the questionnaire on its potential. The questionnaire then concentrated on the students specific knowledge of the availability of elearning courses at Italian universities. It is interesting to note that 49.7 % of students declared to know some distance learning degree courses in Italy. This percentage should be related to the data concerning the knowledge of elearning in general that, as previously stated, is significantly lower. In our opinion, even though most of the students do not have a precise understanding of what e-learning is, around half of the sample have a general idea about what it is. A set of questions were aimed at identifying the information channels used by the students to find information about distance learning courses which interested them. The answers have been analysed in relation to the students interest in enrolling in on line courses. In answer to the question If you were interested in a distance learning degree course, which sources of information would you use to make a choice? each student could indicate two choices from a list of available options. 52.1% of the students replied Searching the Internet, highlighting the importance of university websites in choosing a faculty (despite the fact that websites do not always contain the information students are looking for; Pipitone, Fulantelli and Allegra, 2005). It should be noted that this percentage decreases for students who declared they were interested in elearning (44.40%), while it is almost the same for students who declared they were partially interested in e-learning and students who were not interested in it (53.40% vs %). University student help desks received a high consen-

8 74 Studi e Note di Economia, Anno XIV, n sus (47.2%), thanks to the efforts undertaken all over Italy by universities to publicise their courses within the schools. Two other answers were selected by a similar percentage: Advice from teachers at your school (23.6%) and Attending meetings or fairs about university courses (24.2%). The latter was especially preferred by students interested in elearning (37.80%), considerably higher than the percentages of students partially interested in elearning (24.90%) and students not interested in it (22.90%). Following these were Information centre for young people (13.4%) and Guides and publications (11.4%). Finally, Posters, prospectuses and leaflets from the individual universities (9.9%), Telephone number of enquiry services at the individual universities (9.9% for the whole sample, but preferred by only 4.4% of students interested in e-learning) and Newspapers and magazines (8.1%, increasing to 11.1% for students interested in e-learning and decreasing to 6.2% for students partially interested in it) appeared to be the least popular information channels among the students (Fig.1 shows these results). If you were interested in a distance learning degree course, which sources of information would you use to make a choice? It was of concern to note that in answer to the question Have you ever come across information which was principally about distance learning at university? 89.40% of those interviewed replied No, showing the apparent difficulties which the universities have in providing information about their on-line courses. However, an analysis of the data from students interested, partially interested and not at all interested in e-learning, confirms that students are more receptive to information if it concerns a topic which interests them; in fact the percentage of students interested in e-learning who replied No was 64.4%, for partially interested students the percentage rose to 86.4% and for those who were not interested it reached 92.2%. In order to analyse this data more carefully, the students who had replied positively to the previous question were asked where they had seen this information. In this case, too, most of the information had been found on the Internet (43.6%), much further behind were the traditional media of television and radio (18.8%) and newspapers and magazines (16.2%), then posters (13.7%) and school noticeboards (7.7%). There were notable differences among responses from students interested, partially interested and not interested in e-learning. In particular, the Internet was the channel selected by 54% of the students partially interested in e- learning, by 39.2% of the students not interested, and only by 25% of the students interested. The latter selected in the first place posters, indicated by 37.5% of the students interested in e-learning, but this means of information was the least indicated by students not interested in e-learning (9.8%). None of the students interested in e-learning indicated the school notice board. Although the students indicated the Internet as the main source of information used to find out about on-line degree courses, only 10.1% of the stu-

9 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand Fig. 1 - Sources of information used by students to get information about distance learning degree courses. dents has searched the Internet for online degree courses available in Italy, showing how this channel is in fact not exploited by the students. Even though the percentage doubled for students who indicated an interest in e- learning (20.2%), it was still quite a low figure. Finally, in order to understand the possible causes for this reluctance to search for information on the Internet, students who had actually used the Internet to look for online courses were asked if they were satisfied with the information found. The answers showed that the information available on most university web sites is confusing or satisfies students only partially (56.8%). We should, however, make a distinction between how the quality of the information is perceived by students interested in e-learning, those who are partially interested and those with no interest: 44.4% of the first group said they had found all the information they needed and were therefore satisfied, compared with an overall average of all three groups of 27.9%. The attitude to enrolling in on line courses Focusing on the analysis of the students interest in following on-line courses, we asked them if they would consider enrolling in this kind of course in the coming year. 62.4% of students replied negatively to the question, 33.5% answered maybe and only 4.1% answered positively. The percentage of students in the South of Italy who answered yes was double that of students in the Centre (6% vs. 3%). In order to try and understand the motivation for this rejection of on line

10 76 Studi e Note di Economia, Anno XIV, n education, the students who answered negatively were asked to list their main reasons (2 choices allowed amongst a list of 8 answers): The lack of direct student/teacher contact and interaction (69.8 %) and The absence of relationships and interaction with other students (56.4%) are given as the main reasons, followed by the idea that distance courses are of inferior educational value (29.3 %). It is notable that the educational model that emerges from the answers broadly reproduces the rites of secondary school: face to face lessons, different kinds of interaction with teachers and other students, physical presence in all lessons or at least in some of them. At the same time, we have also tried to analyse the motivation of the choice of the students who (lower percentage of the sample) declared their interest or partial interest in e-learning; in particular, these students were asked to list their main reasons for choosing a distance learning course (2 choices allowed); 58% of the students said: I will begin working, consequently I won t be able to attend traditional university courses ; the second most popular answer (40.6 %) was It s a feasible way of attending prestigious universities without moving to another town and, almost as popular (40.1%) was I think it will be a less expensive solution yet allow me to get a degree. There are no significant differences between students interested in e-learning and students partially interested. We eventually asked all the students to list the three main reasons that could positively influence their choice of enrolling in an on line degree course. Students not interested in e-learning focused their attention on Personalization of study programmes (37.2%) and after this, with an equal percentage of 35.4%, Degree of flexibility and Ease of finding study materials. Students who were partially interested in e-learning highlighted the Ease of finding study materials (40.4%), and the Personalization of study programmes (39.8%). Finally, students who were interested in elearning focused on the Ease of accessing the technology used for the course from home (42.2%), the Degree of flexibility (35.6%) and finally, with the same percentage of 33.3%, on the Ease of finding study materials and on the Use of tests for self evaluation. Students perception of university on-line courses (the evaluation of their advantages and risks) Concerning students perception of potential advantages of on-line courses, we asked What are, in your opinion, potential advantages of on-line degree courses?. It is notable that most students consider the main advantage The possibility to plan their study schedule independently (61.7 %) followed by It is not compulsory to attend the lessons (47.1%). This highlights the fact that absence of time and space constraints is the most attractive feature of e-learning. We have also to note that the third answer given by

11 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand Fig. 2 - Students perception of the potential advantages of on-line degree courses. students was Fewer costs (40.3 %). An in depth analysis of the answers given by students interested in e-learning compared to those of students who are not interested shows that The possibility to interact on line with teachers is seen by the interested students as an advantage (35.6%), while only 10.8% of uninterested students consider it a positive feature (Fig. 2) We tried also to analyse the students perception of the potential disadvantages of on-line courses, asking them What are, in your opinion, the potential disadvantages of on-line degree courses?. In this case the Lack of real interaction with teachers, was indicated by 71.4% of the sample, with a small difference between students interested and uninterested in e-learning (66.7% vs. 74.5%). The second most frequent answer was Lack of exchange of experience/competences with other students (60.9%), and in this case it is a problem perceived more by interested students than by uninterested students (62.2% vs. 56.4%). At the same time, we have tried to analyse the kind of interaction preferred by students in a distance course; responses indicate that there is a slight preference for the synchronous mode of interaction (38.4%) followed by the asynchronous mode (36.5%), while Satellite Television was preferred by only 10.9% of students. In this case, we observe a significant difference: asynchronous interaction is preferred by 44.4 % of students interested in e- learning, while it is preferred by 32.1% of those uninterested. We also asked the students Do you know anybody who has enrolled in an on line degree course?, 95% of the whole sample replied No and only 5%

12 78 Studi e Note di Economia, Anno XIV, n Yes. The percentage of Yes answers was significantly higher among students interested in e-learning (20%) compared to uninterested ones (2.9%). Students who knew people who had enrolled in on line courses were asked if they knew whether they were satisfied with this choice; 61.8 % of the students replied Satisfied, and 10.9% very satisfied. It is interesting to notice that 22.2% of students interested in e-learning know people who are very satisfied, compared to only 5% of uninterested students. Two-way tables with measures of association In order to look for possible associations among the categorial variables obtained by administering the questionnaire we used two statistical tests: Pearson s chi-squared (x 2 ) and Cramer s V. The former allows us to evaluate whether two variables, shown in a two-way table, are independent or not. A value of chi-squared which is less than 0.05 is usually interpreted as a condition for rejecting the hypothesis of independence and accepting the alternative hypothesis of association between the variables. However, a drawback of the chi-squared test is that it depends on a large number of observed cases and, consequently, cannot be directly used for measuring the intensity of the association. For this reason, as well as the chi-squared, we used Cramer s V, which is a relative index between 0 and 1. As Chiandotto e Bertaccini (2003) emphasized, a value of Cramer s V above 0.10 demonstrates a high level of dependency between the analyzed variables. Since in this paper we are interested in observing the characteristics of the demand for distance learning at university level, we have produced all the possible two-way tables, considering each time the question Do you intend to enroll at University after you leave school? compared to the other questions in the questionnaire. To make the results clearer, we include only the main tables in which we found the most significant chi-squared values and the highest values of Cramer s V. The two-way tables show that the possibility of considering university on line courses to be a real option is closely connected both to a knowledge of distance learning (table 1) and to direct information (table 2) and indirect information (table 3) acquired over time. Besides, a high level of dependency was found between the e-learning option and the frequency of use of the Internet and its services (table 4). These results allow us to emphasize how the decision making process which conditions the choice of distance learning is linked to the educational, cultural and technological experiences encountered by the students. Some reflections on the Italian case Only 3.4% of the students said they would not enrol at university for financial reasons. 60.1% of those who intend to continue their education

13 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand expect to attend all the classes. 51.5% expect to attend courses in their home town, and only 19% of Italian students are attracted by the reputation of a university. 72.3% of those interviewed do not understand what e-learning is, 97.9% have never enrolled in an on-line course, 95% do not know anyone who has enrolled in distance learning courses and 89.4% have never come across information about the e-university. With regard to e-learning, the main concern for students is the absence of physical interaction (students-students, students-teacher) while the main interest is the opportunity it provides to study and work at the same time. The outcome is, therefore, a demand for university education which is not related to costs and which is highly influenced by traditional methods of learning. The low reactivity of the demand to costs can be explained by the structure of the Italian university system and its widespread distribution throughout the country which keeps the total costs of education low. It is important to bear in mind the mechanism for setting prices; since the universities are generally state run, they are not required to cover production costs nor to make a profit. While universities act formally as price makers, the fees paid by students amount to little more than 10% of the total costs (Tosi 2005), thus leaving the tax payers to cover the expenses. Market prices for university education in Italy are, therefore, neither a synthesis of competitive equilibrium, nor of rational behaviour which tends to maximize profits, with the result that both prices and quantities expressed by the market are unable to provide information regarding the scarcity and the quality of the education commodity. This implies a distorted evaluation of the inherent risk of educational investment. The students thus have to obtain the missing information by themselves and, in doing so, usually focus their attention on the area where they live, because it is cheaper to find data and opinions there. Besides, to reduce the risk of the investment and the anxieties associated with this crucial step, students appear to reproduce the educational model they experienced during their years at high school, a model based on face to face lessons, the constant classroom presence of pupils and the physical reality of the teacher-pupil relationship. In this context e-learning is of marginal importance. In fact, for the majority of students, e-learning is an unknown method of teaching. In our opinion, the reasons for this are to be found both in the market for university education and in the secondary school. The market does not provide the correct signals and it does not give any specific information about the nature of e-learning. The national data base regarding university education supply, for example, continues to make no distinction between traditional and e-learning courses, thus contributing to producing imperfect information. The Italian high school makes infrequent use of new technologies for education, and particularly the use of on-line methodologies. This means that students have little familiarity with such methods and they have no understanding of e-learn-

14 80 Studi e Note di Economia, Anno XIV, n Tab Associations among the possibility of enrolling in an on-line course and knowledge of distance learning, direct and indirect information, internet skills.

15 M. Allegra, G. Fulantelli, V. Pipitone - On the Characteristics of the Demand ing. They are thus unable to assess personally the risks and opportunities of e-learning. In this context, students have no incentive to look for specific information related to e-learning or to consider the opportunity of choosing an alternative to traditional university education. Moreover, the tiny number of students on e-learning courses does not create the conditions for enriching the market with new information and reducing the problem of imprecise information. The number of students presently enrolled in distance education in Italy does not in fact reach the critical level needed for consolidating specific information. The inefficiency resulting from an imperfect perception of e-learning thus depends on the students level of information. In a world in which information is imperfect, the market equilibrium is of a provisional nature, in the sense that decisions adopted can be modified with a better knowledge of the state of the world. Better information and better use of new technologies for education in secondary schools could thus promote a better knowledge of the opportunities for distance education, allow students to better assess the risk involved in investing in education and stimulate overall growth in the e- learning market. Conclusions The theory of human capital underlines the fact that education is an attractive investment if the expected value of the benefits exceeds the costs of education. In other words, the subjects invest in education if the increment of the expected salary (due to a higher level of education) is higher than the tuition fees, additional living costs, additional transportation costs and opportunity costs related to the education. The Italian laboratory appears to contradict the theoretical conclusions. Although the new learning technologies are lowering the costs of education (consider for example students who work, students who have disabilities and students in outlying regions of the country), the demand for distance education remains quantitively a negligible phenomenon in Italy. A closer analysis of the Italian situation, however, enables us to pay more attention to the mechanisms of the Italian university market. It is not the theory of human capital which is contradicted by the Italian market but rather the Italian market (for distance higher education) which is unsuccessful in allocating the resources efficiently. The Italian experience, in our opinion, serves to pinpoint certain elements of a general nature. Elearning is a new educational methodology which requires a collective perception. In other words, before making a cost-benefit evaluation of the distance learning courses on offer, it its necessary to consolidate a collective perception of the phenomenon, or rather the charac-

16 82 Studi e Note di Economia, Anno XIV, n teristics and potentials of e-learning must become part of the experience and of the information available to the community as a whole. This is because distance education represents an alternative teaching method to the traditional face to face type experienced by the community over the centuries. In the absence of a collective perception, an evaluation of the costs and benefits becomes impossible or is highly prone to error. The level of information available is a discriminating factor in the process of forming a perception of e-learning, a sort of barrier to gaining knowledge about the characteristics and potentials of distance education. When the level of information is low there is no triggering of the mechanism which forms the perception, and the phenomenon of e-learning remains unknown. When there is little information available a student s experience may to some extent compensate for this, promoting a process of risk assessment in relation to distance learning methodologies and triggering an incentive to look for information. Students who have experience of e-learning are in fact equipped to distinguish amongst various information sources and to construct their own opinion. The market can also promote the construction of a collective perception of e-learning, but for this to happen, the market must function efficiently so that prices can express the conditions of deficiency and desirability of the distance learning courses. Where the market mechanisms are not efficient and the information available is imperfect, the role of the public sector may be crucial. Such a sector could in fact be responsible for the production and diffusion of information regarding the quantity and quality of the distance education on offer. This production could, first of all, establish the conditions for activating a mechanism of collective perception of the phenomenon and, secondly, might prevent problems of adverse selection when the best universities abandon the distance education market. Finally, it is important to emphasize the positive correlation between the growth of the distance education university market and the use of e-learning in secondary schools. A greater investment in the diffusion of e-learning in schools may in fact have an impact on students experience and thus establish the conditions for triggering processes for assessing investment in distance education.

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