Events

Prof. Jeffrey C. Ely
Charles E. and Emma Morrison Professor
Northwestern University

I study the monopolistic design of a college admissions test. Students have private information about their ability and apply to colleges by submitting verifiable resumes in addition to test results. Due to screening frictions, the profit maximizing testing structure is less informative than colleges would prefer and distorts admissions probabilities for students with poor resumes. Mandatory testing only makes things worse.