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Skills, Schools, and Credit Constraints: Evidence from Massachusetts

Joshua Goodman

Title:
Skills, Schools, and Credit Constraints: Evidence from Massachusetts
Author(s):
Goodman, Joshua
Date:
Type:
Working papers
Department:
Economics
Permanent URL:
Series:
Department of Economics Discussion Papers
Part Number:
0809-03
Publisher:
Department of Economics, Columbia University
Publisher Location:
New York
Abstract:
Low college enrollment rates among low income students may stem from credit constraints, low academic skill, low quality schools, or some combination of these. Recent Massachusetts data allow the first use of school district fixed effects in the analysis of credit constraints, leading to four primary findings. First, Massachusetts’ low income students have lower intended college enrollment rates than higher income students but also have dramatically lower skills and attend lower quality school districts. Second, inclusion of skill controls greatly reduces but does not eliminate the intended enrollment gap, with low income students seven percentage points less likely to intend enrollment than similarly skilled higher income students. Third, in districts where higher income students are plausibly unconstrained, inclusion of school district fixed effects does little to reduce intended enrollment gaps, with low income students nine percentage points less likely to intend enrollment than similarly skilled higher income students from the same school district. Fourth, low income students in the middle and upper parts of the skill distribution appear the most constrained, particularly with respect to four-year public colleges. State governments could use the methods employed here to identify credit constrained student populations in order to target financial aid more efficiently.
Subject(s):
Economics
Education
Item views:
158
Metadata:
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