Economics Job Talk

Abstract: This paper shows that the within-country spatial distribution of colleges largely contributes to spatial inequalities. Using data on the universe of college applicants and programs in France, I document that higher education options are unevenly distributed across space while students' demand is highly sensitive to geographic proximity. This creates inequalities in access to higher education across space, feeding gaps in educational attainment and spatial skill sorting. To quantify these effects, I build a dynamic model linking equilibrium sorting on the higher education market and location choices of entry-level workers. I show that students' and programs' preferences can be identified and estimated from data on choices and equilibrium outcomes. One-third of regional gaps in educational attainment are explained by the interaction of the uneven distribution of colleges and mobility frictions. Eliminating the latter, however, generates a trade-off, as it benefits students from low-opportunity areas but accelerates their migration to higher education hubs, magnifying regional inequalities. Low-opportunity areas could halt this brain drain and outsource the education of their local labor force by tying mobility scholarships with incentives to return.