Financial Aid, Income, and the Choice of College Curriculum : Is the Economics Major a Normal Good?

This paper examines the role of family income, net tuition, ability, and gender as determinants of a student's choice in college major - focusing on the Economics major in particular. A Multinomial Logit model is utilized using data from the 1993-94 Baccalaureate and Beyond Longitudinal Study. Two approaches are used in the analysis of college majors. First, it is considered to be a homogeneous item, as the literature dictates. Later, the college major is thought of as a heterogeneous distribution of coursework. Results suggest that income, net tuition, ability, and gender play a significant role in the distribution of students amongst college majors