This paper estimates the effect of tuition rates on college enrollment using data for Texas from the 1990 and 2000 Censuses and the 2004 ' 2010 American Community Surveys and geographical data on Community College Taxing Districts. The effect of tuition on enrollment is identified by the facts that tuition rates for those living within a taxing district are lower than those living outside the taxing district and in Texas not all geographic locations are in a taxing district. While the estimated effect of tuition on enrollment depends on the sample used, it is negative and mostly statistically significant in the samples of iadults 18 and older and negative and sometimes statistically significant in the samples of traditional age students 18 to 24. The estimated effect of tuition on enrollment, however, is found to vary considerably by poverty level status with an increase in tuition rates having a statistically significant negative effect on college enrollment for those with household incomes that are at least 200% of the poverty level both for traditional aged students 18 to 24 years old and all adults 18 and older.
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Immigrant Status, Race, and Institutional Choice in Higher Education
March 1998
Working Paper Number:
CES-98-04
This paper examines the postsecondary enrollment decisions of immigrant students, expanding on previous work by explicitly considering their choices among institution types and by examining differences across generations and racial/ethnic categories. Using data from the National Educational Longitudinal Study (NELS:88), we hypothesize that community colleges may play a more significant role in providing access to higher education for immigrants than for the native-born population. Our results support our hypothesis only among Asian immigrants. First-generation black immigrants have a higher probability of enrolling in private vocational schools, while second-generation Hispanics (and native blacks) have a higher probability of enrolling in both public and private four-year colleges and universities. Survey (1988)
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The Impact of Parental Resources on Human Capital Investment and Labor Market Outcomes: Evidence from the Great Recession
June 2024
Working Paper Number:
CES-24-34
I study the impact of parents' financial resources during adolescence on postsecondary human capital investment and labor market outcomes, using house value changes during the Great Recession of 2007-2009 as a natural experiment. I use several restricted-access datasets from the U.S. Census Bureau to create a novel dataset that includes intergenerational linkages between children and their parents. This data allows me to exploit house value variation within labor markets, addressing the identification concern that local house values are related to local economic conditions. I find that the average decrease to parents' home values lead to persistent decreases in bachelor's degree attainment of 1.26%, earnings of 1.96%, and full-time employment of 1.32%. Children of parents suffering larger house value shocks are more likely to substitute into two-year degree programs, drop out of college, or be enrolled in a college program in their late 20s.
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Childhood Housing and Adult Earnings: A Between-Siblings Analysis of Housing Vouchers and Public Housing
January 2013
Working Paper Number:
CES-13-48RR
To date, research on the long-term effects of childhood participation in voucher-assisted and public housing has been limited by the lack of data and suitable identification strategies. We create a national level longitudinal data set that enables us to analyze how children's housing experiences affect adult earnings and incarceration rates. While naive estimates suggest there are substantial negative consequences to childhood participation in voucher assisted and public housing, this result appears to be driven largely by selection of households into housing assistance programs. To mitigate this source of bias, we employ household fixed-effects specifications that use only within-household (across-sibling) variation for identification. Compared to naive specifications, household fixed-effects estimates for earnings are universally more positive, and they suggest that there are positive and statistically significant benefits from childhood residence in assisted housing on young adult earnings for nearly all demographic groups. Childhood participation in assisted housing also reduces the likelihood of incarceration across all household race/ethnicity groups. Time spent in voucher-assisted or public housing is especially beneficial for females from non-Hispanic Black households, who experience substantial increases in expected earnings and lower incarceration rates.
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School Discipline and Racial Disparities in Early Adulthood
June 2021
Working Paper Number:
CES-21-14
Despite interest in the role of school discipline in the creation of racial inequality, previous research has been unable to identify how students who receive suspensions in school differ from unsuspended classmates on key young adult outcomes. We utilize novel data to document the links between high school discipline and important young adult outcomes related to criminal justice contact, social safety net program participation, post-secondary education, and the labor market. We show that the link between school discipline and young adult outcomes tends to be stronger for Black students than for White students, and that inequality in exposure to school discipline accounts for approximately 30 percent of the Black-White disparities in young adult criminal justice outcomes and SNAP receipt.
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Cheaper by the Dozen: Using Sibling Discounts at Catholic Schools to Estimate the Price Elasticity of Private School Attendance
October 2011
Working Paper Number:
CES-11-34
The effect of vouchers on sorting between private and public schools depends upon the price elasticity of demand for private schooling. Estimating this elasticity is empirically challenging because prices and quantities are jointly determined in the market for private schooling. We exploit a unique and previously undocumented source of variation in private school tuition to estimate this key parameter. A majority of Catholic elementary schools offer discounts to families that enroll more than one child in the school in a given year. Catholic school tuition costs therefore depend upon the interaction of the number and spacing of a family's children with the pricing policies of the local school. This within-neighborhood variation in tuition prices allows us to control for unobserved determinants of demand with a fine set of geographic fixed effects, while still identifying the price parameter. We use data from 3700 Catholic schools, matched to restricted Census data that identifies geography at the block level. We find that a standard deviation decrease in tuition prices increases the probability that a family will send its children to private school by one-half percentage point, which translates into an elasticity of Catholic school attendance with respect to tuition costs of -0.19. Our subgroup results suggest that a voucher program would disproportionately induce into private schools those who, along observable dimensions, are unlike those who currently attend private school.
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Who Scars the Easiest? College Quality and the Effects of Graduating into a Recession
September 2024
Working Paper Number:
CES-24-47
Graduating from college into a recession is associated with earnings losses, but less is known about how these effects vary across colleges. Using restricted-use data from the National Survey of College Graduates, we study how the effects of graduating into worse economic conditions vary over college quality in the context of the Great Recession. We find that earnings losses are concentrated among graduates from relatively high-quality colleges. Key mechanisms include substitution out of the labor force and into graduate school, decreased graduate degree completion, and differences in the economic stability of fields of study between graduates of high- and low-quality colleges.
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Universal Preschool Lottery Admissions and Its Effects on Long-Run Earnings and Outcomes
March 2023
Working Paper Number:
CES-23-09
We use an admissions lottery to estimate the effect of a universal (non-means tested) preschool program on students' long-run earnings, income, marital status, fertility and geographic mobility. We observe long-run outcomes by linking both admitted and non-admitted individuals to confidential administrative data including tax records. Funding for this preschool program comes from an Indigenous organization, which grants Indigenous students admissions preference and free tuition. We find treated children have between 5 to 6 percent higher earnings as young adults. The results are strongest for individuals from the lower half of the household income distribution in childhood. Likely mechanisms include high-quality teachers and curriculum.
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A Unified Framework for Measuring Preferences for Schools and Neighborhoods
October 2007
Working Paper Number:
CES-07-27
This paper develops a comprehensive framework for estimating household preferences for school and neighborhood attributes in the presence of sorting. It embeds a boundary discontinuity design in a heterogeneous model of residential choice to address the endogeneity of school and neighborhood attributes. The model is estimated using restricted-access Census data from a large metropolitan area, yielding a number of new results. First, households are willing to pay less than one percent more in house prices ' substantially lower than previous estimates ' when the average performance of the local school increases by five percent. Second, much of the apparent willingness to pay for more educated and wealthier neighbors is explained by the correlation of these sociodemographic measures with unobserved neighborhood quality. Third, neighborhood race is not capitalized directly into housing prices; instead, the negative correlation of neighborhood race and housing prices is due entirely to the fact that blacks live in unobservably lower quality neighborhoods. Finally, there is considerable heterogeneity in preferences for schools and neighbors: in particular, we find that households prefer to selfsegregate on the basis of both race and education.
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You Can Take it With You: Proposition 13 Tax Benefits, Residential Mobility, and Willingness to Pay for Housing Amenities
June 2008
Working Paper Number:
CES-08-15
The endogeneity of prices has long been recognized as the main identification problem in the estimation of marginal willingness to pay (MWTP) for the characteristics of a given product. This issue is particularly important when estimating MWTP in the housing market, since a number of housing and neighborhood features are unobserved by the econometrician. This paper proposes the use of a well defined type of transaction costs ' moving costs generated by property tax laws - to deal with this type of omitted variable bias. California's Proposition 13 property tax law is the source of variation in transaction costs used in the empirical analysis. Beyond its fiscal consequences, Proposition 13 created a lock-in effect on housing choice because of the implicit tax break enjoyed by homeowners living in the same house for a long time. First, I provide estimates of this lock-in effect using a natural experiment created by two subsequent amendments to Proposition 13 - Propositions 60 and 90. These amendments allow households headed by an individual over the age of 55 to transfer the implicit tax benefit to a new home. I show that mobility rates of 55-year old homeowners are approximately 25% higher than those of 54 year olds. Second, all these features of the tax law are then incorporated into a household sorting model. The key insight of this model is that because of the property tax law, different potential buyers have different user costs for the same house. The exogenous property tax component of this user cost then works as an instrument for prices. I find that MWTP estimates for housing characteristics are approximately 100% upward biased when the model does not account for the price endogeneity.
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Parent-Child Bargaining, Parental Transfers, and the Postsecondary Education Decision
May 2002
Working Paper Number:
CES-02-13
Economic models of schooling decisions are largely unitary preference in nature. They ignore parent-child conflict, with parents often acting as the sole decisionmaker. In this paper, a theoretical model is formulated in which parents and child participate in cooperative bargaining as a means of resolving disagreements. The model's implications are compared to those of the unitary preference model, motivating tests of parental altruism and income pooling. Reduced form equations for years of postsecondary schooling and transfers are estimated, both for the full sample and for subsamples defined by type of disagreement, using student-level data from the National Center for Education Statistics' High School and Beyond Surveys. While income pooling is rejected only for the group of students who prefer more schooling than their parents, parental altruism is rejected for all groups. A major finding is that parent-child disagreement is an important determinant of the level of financial support parents provide.
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