Publication: Market power and price discrimination in the US market for higher education
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Program
Department
School College Institute
College of Administrative Sciences and Economics
KU-Authors
KU Authors
Co-Authors
Epple, Dennis
Romano, Richard
Sieg, Holger
Zaber, Melanie
Advisor
Publication Date
Language
Type
Embargo Status
NO
Journal Title
Journal ISSN
Volume Title
item.page.alternative
Abstract
We estimate an equilibrium model of private and state college competition that generates realistic pricing patterns for private colleges using a large national data set from the National Postsecondary Student Aid Study (NPSAS). Our analysis distinguishes between tuition variation that reflects efficient pricing to students who generate beneficial peer externalities and variation that reflects arguably inefficient exercise of market power. Our findings indicate substantial exercise of market power and, importantly, sizable variation in this power along the college quality hierarchy and among students with different characteristics. Finally, we conduct policy analysis to examine the consequences of increased availability of quality public colleges in a state.
Source:
Publisher:
Wiley
Subject
Business and economics
Citation
Has Part
Source:
Rand Journal of Economics
Book Series Title
Edition
DOI
10.1111/1756-2171.12267