Effects of the brazilian university policy of targeting the poor

this paper analyzes theoretically the effects on the quality of the labor force of the introduction of the program called prouni (programa universidade para todos), adopted by the brazilian government in 2005. this program consists of giving tax exemptions to private universities that provide scholarships to students coming from low income families. the analysis suggests that the quality of the labor force can either increase or decrease depending on two crucial variables: the shape of the university sector's supply curve and the level of preparation to face university studies of the students who are targeted by the program vis-à-vis the non-targeted ones.