We study a market where two universities, a public and a private\ud one, compete for students by setting admission standards. Students\ud di¤er in ability and receive a wage premium for participating in higher\ud education. This wage increases with the quality of the university at-\ud tended. The private university maximizes pro ts, the public university\ud maximizes welfare. We show that there is no same-standard equilib-\ud rium. In a speci c example we show that multiple equilibria can exist.\ud In one equilibrium the private university sets a higher admission stan-\ud dard, and in the other equilibrium the public university sets a higher\ud admission standard
To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.