Preferences, Selection, and Value Added: A Structural Approach

60 Pages Posted: 31 Mar 2014 Last revised: 8 Mar 2021

See all articles by Saziye Akyol

Saziye Akyol

Pennsylvania State University, College of the Liberal Arts - Department of Economic

Kala Krishna

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

Date Written: March 2014

Abstract

This paper investigates two main questions: i) What do applicants take into consideration when choosing a high school? ii) To what extent do schools contribute to their students' academic success? To answer these questions, we model students' preferences and derive demand for each school by taking each student's feasible set of schools into account. We obtain average valuation placed on each school from market clearing conditions. Next, we investigate what drives these valuations by carefully controlling for endogeneity using a set of creative instruments suggested by our model. Finally, controlling for mean reversion bias, we look at each school's value-added.We find that students infer the quality of a school from its selectivity and past performance on the university entrance exam. However, the evidence on the value- added by schools shows that highly valued or selective schools do not have high value- added on their students' academic outcomes.

Suggested Citation

Akyol, Saziye and Krishna, Kala, Preferences, Selection, and Value Added: A Structural Approach (March 2014). NBER Working Paper No. w20013, Available at SSRN: https://ssrn.com/abstract=2418128

Saziye Akyol (Contact Author)

Pennsylvania State University, College of the Liberal Arts - Department of Economic ( email )

524 Kern Graduate Building
University Park, PA 16802-3306
United States

Kala Krishna

Pennsylvania State University - Department of Economics ( email )

523 Kern Graduate Building
University Park, PA 16802-3306
United States
814-865-1106 (Phone)
814-863-4775 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
7
Abstract Views
287
PlumX Metrics