Description:

Jose Luis Flor Toro (Northwestern University): Higher Education in Peru: An Economics Overview

Abstract: While the rapid expansion of enrollment in higher education in Latin America has been seen positively, it has also been coupled with lowering quality indicators and other issues. In an extreme reaction, the Peruvian government issued a moratorium on new universities and new branches of existing ones in 2012. This is a great setting to understand the effects of entry on welfare in the higher education industry, as it features asymmetric information and endogenous quality decisions of the providers. Moreover, the overall allocation is centralized through a system called SERUMS, and we exploit this too. Recent reduced-form evidence motivates more cautious inspection of the results, and of the overall allocation results.