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ERIC Number: ED614080
Record Type: Non-Journal
Publication Date: 2021-May
Pages: 47
Abstractor: As Provided
ISSN: ISSN-2042-2695
Formation of College Plans: Expected Returns, Preferences and Adjustment Process. Discussion Paper No. 1765
Azmat, Ghazala; Kaufmann, Katja
Centre for Economic Performance
We exploit a large exogenous shock to study the determinants of college attendance and the role played by one's environment. We analyze whether, and how quickly, adolescents' college plans are adapted, explore factors leading to the adjustment, and examine how these factors ultimately impact later educational attainment. Using differences across East German cohorts induced by the timing of the German Reunification (a change for the East from state socialism to capitalist democracy), we show that shortly after relative to before that time, college plans among high-school students increased substantially, which was followed by sizable increases in the completion of the college entrance certificate five years later. Our analysis sheds light on the elasticity of beliefs and preferences of different cohorts of youths in the case of a large shock. Perceived educational returns, economic preferences ("consumerism") and sociopolitical attitudes ("individualism") adapt quickly in response to the shock and are directly linked to changes in plans and outcomes. Cohorts closer to critical educational junctions at the time of Reunification, however, adjusted their plans to a much lesser extent. While they similarly updated the expected returns to education, they exhibited a slower adjustment in their preferences relative to younger cohorts. [Funding for this report was provided by the Agence Nationale de la Recherche (ANR) and the German Research Foundation (DFG) through CRC TR 224 (project C01).]
Centre for Economic Performance. London School of Economics and Political Science, Houghton Street, London, WC2A 2AE, UK. Tel: +44-20-7955-7673; Fax: +44-20-7404-0612; e-mail:; Web site:
Publication Type: Reports - Research
Education Level: High Schools; Secondary Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: London School of Economics and Political Science (United Kingdom), Centre for Economic Performance (CEP)
Identifiers - Location: East Germany
Grant or Contract Numbers: N/A