We address the determinants of resident and nonresident tuition and enrollment at public universities. A key explanatory variable is the share of out-of-state students enrolled under reciprocity agreements. We find that public universities use out-of-state enrollments primarily to augment student quality, not to make up for losses in state appropriations.In the main out-of-state enrollment levels are relatively insensitive to out-of-state tuition levels charged by institutions. Finally, we find no evidence that public universities increase their in-state or out-of-state tuition levels in response to increased federal or state financial aid for students.
*Published: This paper was subsequently published as Resident and Nonresident Tuition and Enrollment at Flagship State Universities , Michael Rizzo, Ronald G. Ehrenberg, in NBER book College Choices: The Economics of Where to Go, When to Go, and How to Pay For It (2004)
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