Description:

Matteo Magnaricotte (Northwestern University): "College Entry, Educational Spillovers, and Market Structure in Perú”, joint with J. Flor-Toro

Abstract: As they complete the compulsory component of their schooling, students have to weigh the benefits from further education against its cost. The availability of college education can decrease the probability of dropout by increasing the ex-ante returns to a high school diploma. Analyzing the fast-growing higher education market of Peru, we provide preliminary evidence regarding the spillovers of colleges on secondary schooling, identifying an increase in high school graduation rates of similar size to the increase in students attending university. We observe that this spillover effect is present for public colleges but not for private ones. We further discuss how the sequentiality of educational choices and spillover effects of public colleges can affect market structure and private entry.

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