Higher education income elasticity demand for Iranian households

Higher education is an economic good like other goods and services that households, according to their income, have sensitivity to it. This sensitivity is an indicator for assessing household elasticity income for higher education demand. Therefore, in this study the attitude of households toward higher education was examined. The main objective of this study was to calculate higher education income elasticity demand for Iranian households. The major question was: is higher education a kind of luxury, necessary or inferior good for Iranian households? By using a quantitative method and utilizing data from Statistic Center of Iran, the income elasticity demand for urban and rural households during 2005-12 was calculated for 2012 by income deciles. The results showed that the higher the income growth, higher education as luxury goods has become an essential commodity for Iranian households. Consequently, the major hypothesis of this study is accepted. In addition, over time higher education has become an essential commodity for urban and rural households.