Competition and the Cannibalization of College Quality

In this paper we study the consequences of increased competition and geographic differentiation resulting from the deregulation of the college market in Chile and the increase in government scholarships and loans. We study the... [ view full abstract ]

In this paper we study the consequences of increased competition and geographic differentiation resulting from the deregulation of the college market in Chile and the increase in government scholarships and loans. We study the effects of these changes in market characteristics on the efficiency of the higher education system and the accessibility and quality of colleges. We estimate a sorting model to account for vertical and horizontal dimensions of differentiation and quantify the quality of public and private colleges. We quantify the impact of these expansion policies on the distribution of education quality.