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For Whom the Pell Tolls: Market Power, Tuition Discrimination, and the Bennett Hypothesis

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  • Larry D. Singell

    () (University of Oregon Economics Department)

  • Joe A. Stone

    () (University of Oregon Economics Department)

Abstract

Are 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.

Suggested Citation

  • Larry D. Singell & Joe A. Stone, 2003. "For Whom the Pell Tolls: Market Power, Tuition Discrimination, and the Bennett Hypothesis," University of Oregon Economics Department Working Papers 2003-12, University of Oregon Economics Department.
  • Handle: RePEc:ore:uoecwp:2003-12
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    File URL: http://economics.uoregon.edu/papers/UO-2003-12_Singell_Pell.pdf
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    Cited by:

    1. Turner, Nick, 2010. "Who Benefits From Student Aid? The Economic Incidence of Tax-Based Federal Student Aid," University of California at San Diego, Economics Working Paper Series qt7g0888mj, Department of Economics, UC San Diego.

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