Another Antitrust Violation in the Making at the Ivies?

Thom Lambert —  14 September 2006

Harvard College is cutting its early admissions program. According to the New York Times, which is pleased with this move, Harvard’s purported reasons for cutting the program are as follows:

It will make the system fairer because students from sophisticated backgrounds and affluent high schools are far more likely to apply for an early admission than minority students or those from high schools with few counselors. It will help reduce the frenzy that has high school students worrying about college choices in their junior years. It will give admissions officers another semester of performance to consider instead of basing early admission on the junior-year record. And there will be the collateral benefit of encouraging high school seniors to keep studying well into the spring instead of goofing off the minute they receive early admission.

That’s all well and good. But then the Times makes a remark that’s a tad troubling: “By delaying its shift until next fall, Harvard hopes that other institutions will follow it.” Similarly, the Harvard Gazette reports that “Harvard will … delay the shift to a single admissions deadline until the fall of 2007, so that other institutions wishing to make a change will have time to adjust their processes in the same admissions cycle.”


If Harvard wants to (1) make its system fairer and more open to students from less sophisticated and affluent backgrounds, (2) reduce the frenzy facing 11th graders, (3) lengthen the academic records presented to its admissions officers, and (4) encourage its admittees to study during their last semester of high school, then why wouldn’t it start its new system immediately? And why would it care whether its competitors maintain their early admissions programs?

It seems to me that the only reason Harvard would care what its competitors do with regard to early admissions is that it doesn’t want to lose candidates to those competitors, and it realizes it may do so if it makes its admissions protocol less attractive than its competitors’. In other words, Harvard’s unwillingness to act unilaterally suggests that it is seeking a tacit (or perhaps express) agreement with its rivals not to compete for students by offering a difficult-to-administer admissions protocol that many students find attractive.

The Ivies have struggled with antitrust issues before. They used to hold annual meetings to compare financial aid packages offered to admitted students, purportedly for the purpose of ensuring that the aid was distributed equitably. When, in response to a Justice Department challenge, they finally halted that practice, competition for talented admittees increased pretty dramatically. According to a 1993 NYT report (Times Select subscription required):

In the two years since an antitrust action led Ivy League institutions to stop setting common limits on awards to scholarship applicants, the colleges are increasingly being drawn into bidding wars for promising students, officials say.

A student can now receive financial aid offers that vary as much as $5,000 from college to college in the Ivy League. “We have certainly seen in the past two years more instances of significant divergences in financial aid awards,” said James O. Freedman, the president of Dartmouth College in Hanover, N.H. “What it does to us is a student calls us up and says, ‘This institution gave me $2,000 or $4,000 or $5,000 more than you did.’ That rarely happened before.”

The lesson is that competition works to benefit students — even in the Ivy League. If Harvard really thinks the prevailing early admission system is detrimental to Harvard College (for the reasons it cites), then it should eliminate the system immediately, without regard to its competitors’ actions. The fact that it’s giving its competitors a chance to sign on suggests that it’s seeking an agreement to limit competition, and that’s bound to result in a reduction of attractive options for students.

(Incidentally, law school administrators seem to be similarly insensitive to antitrust concerns, as my colleague Royce Barondes and I have documented here.)

Thom Lambert


I am a law professor at the University of Missouri Law School. I teach antitrust law, business organizations, and contracts. My scholarship focuses on regulatory theory, with a particular emphasis on antitrust.

4 responses to Another Antitrust Violation in the Making at the Ivies?

    John L. Davidson 20 October 2006 at 10:52 pm


    You lack intellectual honesty. You are cute here about concerted action and then you write a paper on SSRN about public smoking bans, acting like it never happens.

    Second, elsewhere you claim to be from the Chicago School with a default to laissez-faire and then come over here and wack Harvard for concerted action.

    The fact is that concerted action is the default, especially signaled concerted action and that is why we need regulated markets and government bans on smoking


    If (1) there are high schoolers that would prefer an early admissions option (as there are), and (2) schools actively competing with each other would respond to that demand by offering an early admissions option (as is the case), then an agreement among schools not to compete with each other on this part of the package denies student consumers a benefit that competition would produce. They are injured, and their injury is the type the antitrust laws were designed to prevent.


    It seems to me that anti-trust concerns enter the picture only when the consuming public is harmed– e.g., Standard Oil controlling the price of oil 100 years ago. I don’t see where high school seniors would be hurt by collusion to make the admissions process more fair.

    I also suspect Harvard is delaying its new policy until the 2007 admissions season because applications for the 2006 season are already printed.

Trackbacks and Pingbacks:

  1. TRUTH ON THE MARKET » More Evidence of a Brewing Antitrust Violation at Elite Schools - September 19, 2006

    […] I called it last week. Today’s NYT reports that Princeton has accepted Harvard’s invitation to join it in eliminating early admissions. In addition, the presidents of eleven elite liberal arts colleges (including Swarthmore, Williams, Barnard, and Amherst) have met to discuss, among other things, collectively eliminating their early admission programs and reducing merit-based aid. […]