Profiling in Bargaining Over College Tuition

21 Pages Posted: 22 Nov 2006

See all articles by Dennis Epple

Dennis Epple

Carnegie Mellon University; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute)

Richard E. Romano

University of Florida - Warrington College of Business Administration - Department of Economics

Sinan Sarpca

Koc University - Department of Economics

Holger Sieg

University of Pennsylvania - Department of Economics; National Bureau of Economic Research (NBER)

Abstract

Profiling in college admissions arises when applicant attributes are given weight because they are correlated with unobservable student characteristics that the college values. The article models the admission process of a single college as a bargaining game between the college and a potential student with sequential moves and asymmetric information. We test the empirical implications of this model using a unique data set from a private college in the US. We find that the empirical evidence is consistent with the notion that signalling and profiling are important aspects of the college admission process.

Suggested Citation

Epple, Dennis and Romano, Richard E. and Sarpca, Sinan and Sieg, Holger, Profiling in Bargaining Over College Tuition. Economic Journal, Vol. 116, No. 515, pp. F459-F479, November 2006. Available at SSRN: https://ssrn.com/abstract=946520 or http://dx.doi.org/10.1111/j.1468-0297.2006.01132.x

Dennis Epple (Contact Author)

Carnegie Mellon University ( email )

Tepper School of Business
Pittsburgh, PA 15213-3890
United States
412-268-1536 (Phone)
412-268-7357 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
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CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

Richard E. Romano

University of Florida - Warrington College of Business Administration - Department of Economics ( email )

Gainesville, FL 32611-7140
United States
(352) 392-4812 (Phone)

HOME PAGE: http://www.cba.ufl.edu/faculty/facultyinfo.asp?WEBID=321

Sinan Sarpca

Koc University - Department of Economics ( email )

Rumeli Feneri Yolu
Sariyer 80910, Istanbul
Turkey
+90 (212) 338 1214 (Phone)

HOME PAGE: http://network.ku.edu.tr/~ssarpca/

Holger Sieg

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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