NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Sinan Sarpça

Koç University
Department of Economics
Rumelifeneri Yolu, Sarıyer
34450 İstanbul
Turkey

E-Mail: ssarpca@ku.edu.tr

NBER Working Papers and Publications

April 2017Market Power and Price Discrimination in the U.S. Market for Higher Education
with Dennis Epple, Richard Romano, Holger Sieg, Melanie Zaber: w23360
The main purpose of this paper is to estimate an equilibrium model of private and public school competition that can generate realistic pricing patterns for private universities in the U.S. We show that the parameters of the model are identified and can be estimated using a semi-parametric estimator given data from the NPSAS. We find substantial price discrimination within colleges. We estimate that a $10,000 increase in family income increases tuition at private schools by on average $210 to $510. A one standard deviation increase in ability decreases tuition by approximately $920 to $1,960 depending on the selectivity of the college. Discounts for minority students range between $110 and $5,750.
August 2013The U.S. Market for Higher Education: A General Equilibrium Analysis of State and Private Colleges and Public Funding Policies
with Dennis Epple, Richard Romano, Holger Sieg: w19298
We develop a general equilibrium model of the market for undergraduate higher education that captures the coexistence of public and private colleges, the large degree of quality differentiation among them, and the tuition and admission policies that emerge from their competition for students. The calibrated version of the model matches well the aggregate characteristics of U.S. higher education including college attendance in public and private schools, tuition levels, and the distribution of federal aid. Predictions about the distribution of students across colleges by ability and income and about the provision of institutional aid are realistic. We use the model to examine the consequences of federal and state aid policies. A one-third increase in the availability of federal aid increase...
 
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