IDEAS home Printed from https://ideas.repec.org/a/spr/reecde/v29y2025i2d10.1007_s10058-024-00366-w.html
   My bibliography  Save this article

Holistic versus test-only admission

Author

Listed:
  • Wenhao Zhang

    (South China Normal University)

Abstract

I propose a theoretical framework under which holistic and test-only admission policies can be compared. The framework is based on an extension of the Coate–Loury model (Am Econ Rev 83(5):1220–1240, 1993) by allowing the candidate to signal in some additional attributes: The recruiting institution values the candidate’s competency in two aspects (e.g. academic and leadership skills); standardized test is available only for screening academic skill whereas the candidate can also costly signal about his leadership skill type; the recruiting institution can adopt different admission scores conditional on the presence or absence of the leadership signal (i.e. holistic admission); and the candidate needs to invest in an aspect to be qualified in it. The presence of the signaling stage alters the mechanism by which the two-dimensional investment decision is made compared to the standard Coate–Loury case which corresponds to the signal-blind equilibria interpreted as the outcome under test-only admission, with implication on equilibrium multiplicity and welfare ranking. In particular, we find that the recruiting institution could benefit from the signaling option which leads to a more diversified skill profile but the candidate could be hurt from increased burden from costly investment and signaling even if his admission chance is improved.

Suggested Citation

  • Wenhao Zhang, 2025. "Holistic versus test-only admission," Review of Economic Design, Springer;Society for Economic Design, vol. 29(2), pages 335-364, June.
    • Handle: RePEc:spr:reecde:v:29:y:2025:i:2:d:10.1007_s10058-024-00366-w
    DOI: 10.1007/s10058-024-00366-w
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10058-024-00366-w
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10058-024-00366-w?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Moro, Andrea & Norman, Peter, 2004. "A general equilibrium model of statistical discrimination," Journal of Economic Theory, Elsevier, vol. 114(1), pages 1-30, January.
    2. Shubham Chaudhuri & Rajiv Sethi, 2008. "Statistical Discrimination with Peer Effects: Can Integration Eliminate Negative Stereotypes?," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 75(2), pages 579-596.
    3. Young†Chul Kim & Glenn C. Loury, 2018. "Collective Reputation And The Dynamics Of Statistical Discrimination," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(1), pages 3-18, February.
    4. Coate, Stephen & Loury, Glenn C, 1993. "Will Affirmative-Action Policies Eliminate Negative Stereotypes?," American Economic Review, American Economic Association, vol. 83(5), pages 1220-1240, December.
    5. Fryer, Roland, 2007. "Belief Flipping in a Dynamic Model of Statistical Discrimination," Scholarly Articles 2955768, Harvard University Department of Economics.
    6. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sue H. Mialon, 2024. "Inherited inequality and discrimination," LABOUR, CEIS, vol. 38(2), pages 256-277, June.
    2. Kim, Young-Chul & Loury, Glenn, 2012. "Collective Reputation and the Dynamics of Statistical Discrimination," MPRA Paper 54950, University Library of Munich, Germany, revised 31 Mar 2014.
    3. Kim, Young-Chul & Loury, Glenn C., 2019. "To be, or not to be: Stereotypes, identity choice and group inequality," Journal of Public Economics, Elsevier, vol. 174(C), pages 36-52.
    4. Mialon, Sue H. & Yoo, Seung Han, 2017. "Incentives for discrimination," Journal of Economic Behavior & Organization, Elsevier, vol. 136(C), pages 141-160.
    5. Feng, Shuaizhang & Zheng, Bingyong, 2009. "Cherry-Picking in Labor Market with Imperfect Information," IZA Discussion Papers 4309, Institute of Labor Economics (IZA).
    6. Samuel Bowles & Glenn C. Loury & Rajiv Sethi, 2014. "Group Inequality," Journal of the European Economic Association, European Economic Association, vol. 12(1), pages 129-152, February.
    7. Peter Blair & Bobby Chung, 2017. "Job Market Signaling through Occupational Licensing," Working Papers 2017-50, Human Capital and Economic Opportunity Working Group.
    8. Thomas Breda & Son Thierry Ly, 2012. "Do professors really perpetuate the gender gap in science? Evidence from a natural experiment in a French higher education institution," Working Papers halshs-00677438, HAL.
    9. Rosa, Benjamin, 2022. "Diversity versus Equity in Government Contracting," MPRA Paper 114765, University Library of Munich, Germany.
    10. Richard Chisik, 2015. "Job market signalling, stereotype threat and counter‐stereotypical behaviour," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 48(1), pages 155-188, February.
    11. Peter Q. Blair & Bobby W. Chung, 2021. "Informed Choices: A Model of Occupational Licensing and Statistical Discrimination," Upjohn Working Papers 21-351, W.E. Upjohn Institute for Employment Research.
    12. Lepage, Louis Pierre, 2020. "Endogenous learning and the persistence of employer biases in the labor market," CLEF Working Paper Series 24, Canadian Labour Economics Forum (CLEF), University of Waterloo.
    13. Regev, Tali, "undated". "Imperfect Information, Self-Selection and the Market for Higher Education," Foerder Institute for Economic Research Working Papers 275730, Tel-Aviv University > Foerder Institute for Economic Research.
    14. Yuki, Kazuhiro, 2012. "Stereotypes, segregation, and ethnic inequality," MPRA Paper 39704, University Library of Munich, Germany.
    15. Kim, Young Chul & Loury, Glenn, 2009. "Group Reputation and the Dynamics of Statistical Discrimination," MPRA Paper 18765, University Library of Munich, Germany.
    16. Thomas Breda & Son Thierry Ly, 2012. "Do Professors Really Perpetuate the Gender Gap in Science? Evidence from a Natural Experiment in a French Higher Education Institution," CEE Discussion Papers 0138, Centre for the Economics of Education, LSE.
    17. Ashley C. Craig, 2023. "Optimal Income Taxation with Spillovers from Employer Learning," American Economic Journal: Economic Policy, American Economic Association, vol. 15(2), pages 82-125, May.
    18. Rune V. Lesner, 2016. "Testing for Statistical Discrimination based on Gender," Economics Working Papers 2016-07, Department of Economics and Business Economics, Aarhus University.
    19. Simon Quinn & Tom Gole, 2014. "Committees and Status Quo Bias: Structural Evidence from a Randomized Field Experiment," Economics Series Working Papers 733, University of Oxford, Department of Economics.
    20. David Bjerk, 2008. "Glass Ceilings or Sticky Floors? Statistical Discrimination in a Dynamic Model of Hiring and Promotion," Economic Journal, Royal Economic Society, vol. 118(530), pages 961-982, July.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:reecde:v:29:y:2025:i:2:d:10.1007_s10058-024-00366-w. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.