For Whom the Pell Tolls: Market Power, Tuition Discrimination, and the Bennett Hypothesis
AbstractAre federal Pell grants "appropriated" by universities through increases in tuition - consistent with what is known as the Bennett hypothesis? Based on a panel of 71 universities from 1983 to 1996, we find little evidence of the Bennett hypothesis among either public or lower-ranked private universities. For top-ranked private universities, though, increases in Pell grants appear to be more than matched by increases in net tuition. The behavior most consistent with this result is price discrimination that is not purely redistributive from wealthier to needier students.
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Bibliographic InfoPaper provided by University of Oregon Economics Department in its series University of Oregon Economics Department Working Papers with number 2003-12.
Date of creation: 10 Apr 2003
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