Competition and the cannibalization of college quality

Over the last 30 years, the Chilean government deregulated the higher education market. As a result, universities massively expanded their network of campuses, which intensified the competition between institutions and rapidly increased enrollment. In 1990, most Chilean universities were public, and concentrated their activity around one region. Over the following 20 years, the number of private campuses whose enrollees were eligible for government financial aid nearly doubled, while the fraction of college students enrolled in private universities increased from 25% to 54.3%. At the same time, traditional universities diversified their operation, and now cover on average two regions through multiple campuses. From 2001-2010 the average number of campuses increased from 1.57 to 2.56 for public universities, and from 1.25 to 3.9 for private universities. On average, 84% of students enrolled at a public university are a liated with its main campus, compared to nearly 100% in the early 1990s. This trend is even more pronounced among private universities: 58% of their students are a liated with the main campus (compared to 97% in 1992), and an average private university is present in four regions (compared to one in 1992). Much of this growth from Private colleges was caused by a reform on the student loan program in 2006, which gave access to governmental loans to students enrolled in accredited