Finding Out Who You Are: A Self‐Exploration View of Education

Sungmin Park

Journal of Public Economic Theory, 2025, vol. 27, issue 2

Abstract: I study the optimal design of information in education. Students in my model have different priors about their talents and update their beliefs after receiving noisy signals about themselves. I show that the socially optimal signal structure depends only on the average priors of the participating students. In particular, an optimal structure encourages a career in which the average participant has a comparative advantage. In an extended model with human capital accumulation, optimal education targets the participants who respond most sensitively to information.

Date: 2025
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