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An exploration in school formation: Income vs. Ability

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  • Alkan, Ahmet
  • Anbarci, Nejat
  • Sarpça, Sinan

Abstract

We study stable school formation among four students that differ in ability and income. In the presence of ability complementarities and school costs to be shared, we identify the conditions under which a stable allocation is efficient, inefficient, nonexistent, and tell who become peers.

Suggested Citation

  • Alkan, Ahmet & Anbarci, Nejat & Sarpça, Sinan, 2012. "An exploration in school formation: Income vs. Ability," Economics Letters, Elsevier, vol. 117(2), pages 500-504.
    • Handle: RePEc:eee:ecolet:v:117:y:2012:i:2:p:500-504
    DOI: 10.1016/j.econlet.2012.06.048
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    References listed on IDEAS

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    1. Jacob M. Markman & Eric A. Hanushek & John F. Kain & Steven G. Rivkin, 2003. "Does peer ability affect student achievement?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(5), pages 527-544.
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    Cited by:

    1. Ahmet Alkan & Alparslan Tuncay, 2014. "Pairing Games and Markets," Working Papers 2014.48, Fondazione Eni Enrico Mattei.

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    More about this item

    Keywords

    School formation; Stable matching; Peer effects; Multilateral bargaining; Assortative matching;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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