Doctoral Dissertation Research in Economics: Competing Campuses: College Majors, Tuition and Admissions

University Of Virginia Main Campus, Charlottesville VA

Investigators

Abstract

American universities differ greatly in the majors they offer. This means that students' preference for a major may determine their choices of university. A university, seeking qualified applicants will select tuition levels and major offerings given its resources, student demand, and competition from other universities. The proposed research will study student application and enrollment decisions and university choices of tuition, majors offered, and admissions, focusing on how university competition for students and its financial conditions affect admissions and enrolments. The research will combine several large data sets and modern methods to study how choices made by students and universities interact to determine university enrolments. The result of this research will provide a tool for making higher education decisions by students and universities policies on majors to offer. The success of current policies to promote and encouraged STEM education in the U.S. depends on providing these majors by universities; this research therefore provides a guide on how best to develop U.S. STEM workforce. This research project develops and estimate an equilibrium model of the US higher education market. The PIs specify a utility function for high school seniors and an objective function for universities. The student utility function is estimated using a GMM estimator that instrument for endogenous university characteristics. The PIs then estimate the parameters of the university's objective function assuming universities play a Nash game, in which they jointly set prices and majors offered considering the actions of other universities. The estimation of the university objective will follow previous work in Industrial Organization that uses partial identification to address multiple equilibria that arise in simultaneous games. The results of this research project will provide an input into the development U.S. STEM education workforce, hence US's global technological leadership and economic growth. This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.