DP15749 University Dropout Problems and Solutions
|Publication Date:||February 2021|
|Keyword(s):||Higher education, Option value|
|Programme Areas:||Labour Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=15749|
Frequent non-completion in optional education can be efficient if dropouts optimally exercise an option rationally foreseen by previous enrollment choices. This paper shows that in educational opportunities and groups of students where enrollment resolves more pronounced individual uncertainty both enrollment and dropout are higher, with ambiguous degree completion effects, and educational outcomes are unambiguously better in expectation and on average.