Law and public administration schools in Russia vastly exceed in their popularity sciences and engineering. We relate such lopsided demand for higher education to the quality of institutions setting “rules of the game” in economy and society. Cross-country and Russian interregional data indicate the quality of institutions (rule of law, protection of property rights etc.) is negatively associated with the demand for education in law, and positively — in sciences and engineering. More gifted younger people are particularly sensitive to the quality of institutions in choosing their fields of study, and such selection is an important transmission channel between institutions and economic growth.
