Stratification in college entry and completion

This paper examines stratification of opportunities in college access and completion. Using propensity score methods, we investigate two comparisons: (1) four- versus two-year public colleges and (2) private versus public two-year colleges. While previous research finds lower degree completion in two-year than in four-year public colleges, the comparability of students is doubtful. This paper re-considers the public four-year college effect, but for similar students and additional relevant outcomes. The second comparison is a new one. Though recruiting similar students as public two-year colleges, private two-year colleges use different organizational procedures, and we find that they have a different impact on comparable students’ degree completion. We speculate about the reasons for these differences and whether they suggest potential benefits of adapting these procedures for public two-year colleges.     

Search With Adverse Selection

This paper analyzes a sequential search model with adverse selection. We study information aggregation by the price—how close the equilibrium prices are to the full‐information prices—when search frictions are small. We identify circumstances under which prices fail to aggregate information well even when search frictions are small. We trace this to a strong form of the winner's curse that is present in the sequential search model. The failure of information aggregation may result in inefficient allocations.     

DO SUBSIDIES INCREASE CHARITABLE GIVING IN THE LONG RUN? MATCHING DONATIONS IN A FIELD EXPERIMENT

Subsidizing charitable giving—for example, for victims of natural disasters—is very popular, not only with governments but also with private organizations. Many companies match their employees' charitable contributions, hoping that this will foster the willingness to contribute. However, systematic analyses of the effect of such a matching mechanism are still lacking. This article tests the effect of matching charitable giving in a randomized field experiment in the short and the long run. The donations of a randomly selected group were matched by contributions from an anonymous donor. The results support the hypothesis that a matching mechanism increases contributions to a public good. However, in the periods after the experiment, when matching donations have been stopped, the contribution rate declines for the treatment group. The matching mechanism leads to a negative net effect on the participation rate. The field experiment therefore provides evidence suggesting that the willingness to contribute may be undermined by a matching mechanism in the long run. (JEL: C93, D64, H00)