Cora Wang

Student Information Acquisition and Colleges' Incentives for Early Admissions (2025)

Abstract: This paper studies how student preference uncertainty and heterogeneity in school popularity shape elite colleges’ choices between early-decision (ED) and regular-decision (RD) admissions. I develop a two-stage game in which two asymmetric schools first choose whether to adopt ED or RD and then set their admission criteria, while students apply under ex ante uncertainty about which school they will ultimately prefer. I show that an equilibrium in which both schools adopt ED always exists, whereas an equilibrium in which both schools adopt RD can be sustained only when student preference uncertainty is sufficiently high. When uncertainty is low, ED-ED is the unique equilibrium and is the optimal admission policy. When uncertainty is very high, both ED-ED and RD-RD can arise, and schools face a coordination failure. For intermediate levels of uncertainty, schools are in a prisoner’s dilemma: both would prefer RD-RD, but strategic pressure leads to the unique ED-ED equilibrium. The model provides a mechanism that helps rationalize recent attempts by highly popular colleges to eliminate, and later reinstate, early admissions, as well as the shift toward non-binding but restrictive early-action programs.

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