Students' Mobility and Regional Disparities in Quality and Returns to Education in Italy

Patrizia Ordine () and Giuseppe Rose

Giornale degli Economisti, 2007, vol. 66, issue 2, 149-176

Abstract: The paper analyzes the characteristics of the supply of higher education in different geographical macroareas using a strategic interaction framework. We investigate the issue of educational quality differentials in a centralized funding system. In the presence of moving costs and asymmetric information on individuals ability, we show that only highability students acquire education and the quality of education is lower in macroareas where the moving costs are higher in the only perfect Bayesian equilibrium consistent with forward induction. Our model predicts that direct subsidies to universities may be ineffective in improving the quality of education in the less developed areas. When regional disparities are not too large, efficiency can be increased by subsidizing student mobility.

Keywords: perfect bayesian equilibrium; forward induction; spatial models; propensity score matching (search for similar items in EconPapers)
JEL-codes: D82 I21 I28 J24 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (2)

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