Effects of Admission Programs of Universities on Admission Rates of Students

Universities in the United States can choose to use SAT scores or motivation letters for their admissions. However, which of the two should be preferred is a highly debated topic and former theoretical literature has not provided a conclusive answer to the question of which admission program should be chosen. Therefore, this theoretical model is set up to research the optimal admission program for universities and the underlying effects of the different admission programs on student admissions. The optimal combination of admission programs differs per student enrolment. University of Chicago decided, presumably for ethical reasons, to no longer require SAT scores from their applicants but only motivation letters, whereas low-quality universities require SAT scores. Rich students mostly benefit from the universities choosing SAT scores for their admissions in tight markets or when one university uses SAT scores and the other university chooses motivation letters. Poor students benefit in loose markets from both universities choosing SAT scores. More motivated students benefit from a university basing their admissions on motivation letters.