Kehinde Ajayi (Boston University) will present:
"An Empirical Analysis of School Choice Under Uncertainty"
at 3pm on Wednesday, November 16, 2016 in 310 Silsby

Please sign up for a meeting, lunch, or dinner at:
https://docs.google.com/spreadsheets/d/1eJO4Bn_WgPsQuaglwLUkgZJcTwBd1OCr7GIbSit0XAY/edit?usp=sharing

Abstract

This paper develops a framework for quantifying student welfare in school choice problems with uncertain admission chances. Our approach, based on optimal portfolio theory, overcomes the curse of dimensionality and allows us to recover individual preferences along with policy-invariant primitives that generate student choices. We use counterfactual simulations to conduct two policy experiments: 1) analyzing the relationship between the number of choices permitted and student welfare, and 2) estimating the effects of reducing student uncertainty. An application using administrative data from a merit-based school choice system in Ghana demonstrates that uncertainty in merit-based systems is particularly disadvantageous for low-performing students. Thus, the design of school choice mechanisms has important implications for the distribution of student welfare.





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