THE ECONOMIC NATURE OF EDUCATIONAL SERVICES AND THE SPECIFICS OF THEIR PROMOTION IN THE HIGHER EDUCATION MARKET
DOI:
https://doi.org/10.5281/zenodo.22866970Abstract
The economic nature of educational services is commonly described in terms of intangibility, inseparability, heterogeneity, and perishability. This article argues that these characteristics are not the principal operative properties and examines an alternative proposition: higher education is dominated by credence attributes that buyers cannot verify before, during, or, in most cases, even after consumption, and the distinctive features of promotion in this market stem primarily from this characteristic. Three constructs are examined using panel data from twenty anonymised higher education institutions in Uzbekistan. Claim composition classifies promotional statements according to verifiability distance, introduced here as the number of steps separating a claim from independent verification. Reach and yield conversion are measured separately: the former as applications generated per unit of promotional expenditure and the latter as the proportion of offers converted into enrolments. The results reveal a clear distinction between these two stages. Nine per cent of promotional claims can be verified before a student commits, whereas forty-eight per cent cannot be independently verified, placing the mean claim 2.12 steps from verification. Promotional expenditure has an elasticity of 0.914 with respect to applications, with a t-statistic of 20.72, and explains 96.0 per cent of their variation, whereas the share of verifiable claims has virtually no effect, with a coefficient of −0.002 and a t-statistic of −0.81. At the enrolment stage, however, the relationship changes substantially. The coefficient on promotional expenditure declines from 0.0834 (t = 2.95) to 0.0029 (t = 0.26) once the share of verifiable claims is included in the model. The coefficient on the verifiable-claim share is 0.0078 per percentage point (t = 12.90), while R² increases from 0.326 to 0.938. Because offers increase less than proportionally with applications, with an elasticity of 0.797, promotional expenditure has no statistically significant association with enrolments once admission capacity is held constant, with a coefficient of 0.0274 and a t-statistic of 0.54. A ten-percentage-point increase in the share of verifiable claims is associated with a 7.8-percentage-point increase in enrolment yield, corresponding to 3,533 additional enrolments at the sector-level offer base without additional promotional expenditure.Keywords
educational services, credence goods, verifiability, higher education marketing, enrolment yield, information disclosure, Uzbekistan.References
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