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Peer group and distance: when widening University participation is better

Cesi, Berardino and Paolini, Dimitri (2014) Peer group and distance: when widening University participation is better. The Manchester School, Vol. 82 (S2), p. 110-132. eISSN 1463-6786. Article.

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DOI: 10.1111/manc.12049


We study the effect of a new university in a two-city model in which individuals’ utility depends on own ability, peer group ability, formal education and mobility costs. We compare a monopoly (one university in one city) with a two-university system (one university in each city). Introducing the second university improves welfare when the fixed cost of each university is low. With two universities, we obtain a symmetric equilibrium for every mobility cost and asymmetric equilibria for low mobility costs. The symmetric system induces the highest welfare and is also Strong Nash (for high mobility costs).

Item Type:Article
ID Code:10558
Uncontrolled Keywords:Peer group quality, mobility costs, Universities
Subjects:Area 13 - Scienze economiche e statistiche > SECS-P/01 Economia politica
Divisions:002 Altri enti e centri di ricerca del Nord Sardegna > CRENoS-Centro Ricerche Economiche Nord Sud, Università di Cagliari e Università di Sassari
001 Università di Sassari > 01-a Nuovi Dipartimenti dal 2012 > Scienze economiche e aziendali
Publisher:Blackwell / Wiley
Deposited On:07 Jan 2015 10:37

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