Higher Education as a Signal of Non-Cognitive Skills: Self-Control Preferences in a High Temptation Environment

Abstract

This paper proposes a new theory of higher education that combines self-control preferences with Spence-like signalling. Successfully completing a university level qualification requires substantial non-cognitive skills, such as self-control, as well as cognitive ability. Signalling equilibria exist in which academic achievement is at least partially revealing despite a student's type being multidimensional. Further, it is shown that the lower the minimum study requirement imposed by a university programme, the more information about ability and self-control is contained in the decision to enter university and in the grades obtained while there.