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Article Dans Une Revue Journal of the European Economic Association Année : 2008

Efficient Tuition Fees and Examinations

Résumé

We assume that students observe only a private, noisy signal of their ability and that universities can condition admission decisions on the results of noisy tests. If the university observes a private signal of each student's ability, which is soft information, then asymmetries of information are two-sided, and the optimal admission policy involves a mix of pricing and pre-entry selection, based on the university's private information. In contrast, if all test results are public knowledge, then there is no sorting on the basis of test scores: Tuition alone does the job of implementing an optimal degree of student self-selection. These results do not depend on the existence of peer effects. The optimal tuition follows a classic marginal social-cost pricing rule.

Dates et versions

halshs-00355489 , version 1 (22-01-2009)

Identifiants

Citer

Robert Gary-Bobo, Alain Trannoy. Efficient Tuition Fees and Examinations. Journal of the European Economic Association, 2008, 6 (6), pp.1211-1243. ⟨10.1162/JEEA.2008.6.6.1211⟩. ⟨halshs-00355489⟩
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