Abstract
This paper estimates the effect of tuition fees on enrolment behaviour among prospective students in Germany. According to the rational choice theory (RCT), we argue that due to the higher costs brought on by such fees tuition fees should have a negative effect on student's enrolment. This should be even more pronounced among prospective students from socially disadvantaged families. The analyses take advantage of the non-uniform introduction of tuition fees that provide the unique case of a natural experiment. To account for non-random selection, we apply a “difference-in-differences propensity score matching” method. However, none of the analyses provided any evidence to support the assumption that tuition fees of €500 have a negative effect on the enrolment decisions of prospective students including those from families where neither parent has a university degree.
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