WILL ONLINE INSTRUCTION LOWER COSTS OVER THE SHORT RUN?
Based on our analysis, the short answer is, surprisingly, no. Simply moving more instruction online does not fundamentally alter the cost equation. We look at many departments over time and associate changes in online offerings with changes in average instructional cost per student. We find a negligible association between online credits and instructional costs, as shown in Figure 2. Shifting online instruction from zero to 10% of credits is associated with about a 1.04% reduction in departmental instructional costs, which we cannot statistically distinguish from no effect. Patterns are similar for undergraduate and graduate education.