The internet and particularly the world wide web now provide us with the means of changing not only the way we teach but also the way we interact and communicate with students. The virtual classroom does not just change the way instruction is produced. It provides a greater variety of communication channels at a lower cost than older technologies. It also opens lower cost communication channels with students outside of the classroom; some of that communication may be automated by the instructor and so further reduce the cost.

I view education from a human capital perspective. The education process is a technology and moving to a virtual classroom is a technological change. The virtual classroom represents a more capital intensive technology. This increased capital intensity is represented in both the equipment required to communicate and the human capital of the instructor. One of the questions concerning this technological change must be whether it is worth the investment. The investment is socially efficient if we can produce the same output with fewer inputs. I'll use this production analogy here but it is clear that the technological change will alter our conception of education and the dynamics of the process.

Every teacher uses a syllabus, assignments, and lectures. I want to consider how those production inputs are altered by the notion of a virtual classroom. I also want to use a few examples to show that this technology can be used to produce a course that is different from the traditional one and that, at the margin, has the potential to increase the value of the human capital output at a lower cost. The following is my own conception of a virtual classroom. Some of the examples are taken from work on my work on the Kiwi Club, Business Finance, Corporate Finance, and Uncertainty web pages. The figures are pictures of web pages and represent links to the virtual versions of these documents. All subsequent figures also represent links to pages served on the web.

Course Syllabus: The preparation of a course syllabus becomes more efficient because it is possible to view what others in the same discipline are doing by viewing their syllabi online via course link collections such as the World Lecture Hall at UT. The course syllabus is distributed on a course web server. This, however, is a syllabus with a difference. Links are provided to: (i) the instructor's vita; (ii) the previous grade distribution; (iii) assignments; (iv) lecture outlines, notes, and presentations; the links to assignments and presentations are hidden until I choose to have them automatically revealed on the web site; (v) an e-mail gateway to the instructor and teaching assistant; (vi) the computation center's information, e.g., on setting up an e-mail account, computer classes, etc.; (vii) a listserv when I am running an e-mail list for the class; (viii) a usenet newsgroup; (ix) a student roster with assignment scores and exam grades; this roster is only be accessible by the students and instructor. The roster is constructed so that the student only has access to her own scores. To view the roster from the student's perspective use Doe and Doe for name and password, respectively. Click on the name to see more detailed information. The roster is a relational database and is linked to other databases that are used to collect assignments, e.g., see assignment four, and these databases are then linked to the web; to see the linkage in action enter some information for John Doe's assignment and then go back to the roster to see how John's assignment score is automatically updated. Assignments: I construct an assignment sheet for each class period that includes announcements, class notes, a brief lecture outline, reading assignments, and problem assignments. Students have submitted assignments via an e-mail link to an address that I specify. I filter the e-mail upon arrival so that it is put in the correct mailbox for that assignment. I've found that It is more efficient, however, to construct assignment databases with a web link to accept the submissions; the database is linked to the roster, the assignment is automatically scored, and the roster is automatically updated to reflect that score. I also assign problem sets using David Davies' MedWeb quiz server. David's quiz server automatically grades the quiz and returns the score to the student. One of the quizzes that I serve on MedWeb at the University of Birmingham in the UK is shown in a figure here.

The web can also be used to provide feedback to the students on their assignments. The quizzes provide immediate feedback; in addition to the score that is return, if the student does not select the correct response to a question then I sometimes provide an automated comment indicating the error, e.g. see the pre-screen quiz. It is also possible to provide answers and feedback in a variety of other forms that cannot be easily duplicated by conventional methods. Answers to problems can be provided in excel files, theorist notebooks, Adobe Acrobat pdf files, etc.. The pdf format allows a heavily formatted file to be viewed on most platforms but it also allows links to be placed in the file; this allows the instructor, for example, to link an answer to a lecture where the relevant concept was developed. Serving an excel file allows the student to view the formulas in spreadsheet cells and see how the problem was set up and solved; it also allows the student to use the spreadsheet as the basis for a template to solve similar problems.

The web provides a means of distributing presentations, e.g. powerpoint, persuasion, pdf, etc., that can be viewed on the web at any time or linked to in the classroom and used as part of a lecture. The digital lecture format provides a powerful means of integrating concepts, formulas, examples and applications. The lecture on the Time Value of Money provides links to a formula sheet that links to web pages that allow the student to use the formula to generate numbers; some of these pages require the mathview plug-in. The presentations also include quicktime movies, excel slide shows, etc.; the movie link here can be used while explaining the notion of risk.

I believe most students see the benefits and future of the virtual classroom. Here is a comment from one of my ex-students. ". . . . I just wanted to thank you for helping me learn more about finance and computers than in any other class. Thanks to you I have attained some very valuable abilities I can put on my resume, and I have a better grasp on some of my other classes that require the use of the Internet. I think combining the use of computer presentations and the financial material really helped me; topics like the time value of money and financial reports made much more sense when combined with a graphic presentation or an annual report for Intel from the SEC. In fact, I was recently able to enter the EDGAR database and get a 10-k and a 10-q for Dell to help me when I interview with them next week. A year ago I wouldn't have had a clue about the Internet; thanks for opening my mind to a whole new world."