Price Regulation, Price Discrimination, and Equality of Opportunity in Higher Education: Evidence from Texas
American Economic Journal: Economic Policy
vol. 11,
no. 4, November 2019
(pp. 31-65)
(Complimentary)
Abstract
We assess the importance of price regulation and price discrimination to low-income students' access to opportunities in public higher education. In 2003, Texas shifted tuition-setting authority away from the state legislature to public universities themselves. In response, most institutions raised sticker prices and many began charging more for high-earning majors, such as business and engineering. We find that poor students actually shifted toward higher earning programs following deregulation, relative to non-poor students. Deregulation facilitated more price discrimination through increased grant aid and enabled supply-side enhancements, which may have partially shielded poor students from higher sticker prices.Citation
Andrews, Rodney J., and Kevin M. Stange. 2019. "Price Regulation, Price Discrimination, and Equality of Opportunity in Higher Education: Evidence from Texas." American Economic Journal: Economic Policy, 11 (4): 31-65. DOI: 10.1257/pol.20170306Additional Materials
JEL Classification
- D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- H75 State and Local Government: Health; Education; Welfare; Public Pensions
- I22 Educational Finance; Financial Aid
- I23 Higher Education; Research Institutions
- I24 Education and Inequality
- I28 Education: Government Policy
- I32 Measurement and Analysis of Poverty
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