Quality, tuition, and applications to in-state public colleges

Abstract

This paper investigates the main determinants of applying to in-state public colleges and universities. I use data from over 500,000 SAT and ACT test takers to examine the roles of college quality and tuition in the college selection decision. I take advantage of the interstate variation in quality and tuition at the public flagship universities in each state to examine these influences empirically. The main finding is that student willingness to pay for quality is quite large. a one standard deviation increase across states in college quality at the flagship school is estimated to have an equal but opposite effect on student applications as a 70–80% increase in in-state tuition.