CHOICE IN HIGHER EDUCATION: COLLEGE MAJORS. FINANCIAL AID. AND TRANSITION TO THE LABOR MARKET The argument above, supported by the theoretical model developed in the next section, predicts that ∂ 0 ∂ c θ for moderate values of δ but that ∂ = 0 ∂ c θ when δ is zero or large (. when parents care only about effectiveness or only about peer group). To the extent that θ tends to increase with choice, then, we can infer that parents peer group preferences are small enough to prevent a breakdown in high-choice markets of the sorting mechanism that rewards high-μ administrators with high- x students
