This dissertation studies the market for higher education and impacts of higher education policy on the market. In the first chapter, I estimate the short-run elasticity of supply of higher education using the rollout of state merit grant programs as plausibly exogenous variation in student demand for in-state higher education. I find that public and private not-for-profit four-year institutions have elastic supply responses to these programs. Public institutions have an estimated elasticity of 2.1 and private institutions have an estimated elasticity of 1.34. I estimate the causal effects of marginally qualifying for and receiving the federal Pell Grant and the Kentucky College Access (CAP) Grant on students' academic outcomes and future labor market earnings. I leverage variation in grant receipt using a discontinuity in eligibility around the threshold for meeting the financial need criteria for these grants. I find no impact of receiving these grants on academic outcomes or earnings. The only change in student behavior that is robust is a reduction in borrowing. Finally, I develop a dynamic structural model of college investment in expanding their enrollment capacities. The model predicts that institutions pay for capacity investments by raising their list prices on all students. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://bibliotheek.ehb.be:2222/en-US/products/dissertations/individuals.shtml.]