The Effect of Credit Constraints on the College Drop-Out Decision A Direct Approach Using a New Panel Study

A serious difficulty in determining the importance of credit constraints in education arises because standard data sources do not provide a direct way of identifying which students are credit constrained. This has forced researchers to adopt a variety of indirect approaches. This paper differentiates itself from previous work by taking a direct approach for providing evidence about this issue which is made possible by unique longitudinal data that have been collected specifically for this type of purpose. Our results suggest that, while credit constraints likely play an important role in the drop-out decisions of some students, the large majority of attrition of students from low income families should be primarily attributed to reasons other than credit constraints.

The Causal Effect of Studying on Academic Performance

Despite the large amount of attention that has been paid recently to understanding the determinants of educational outcomes, knowledge of the causal effect of the most fundamental input in the education production function - students' study time and effort - has remained virtually non-existent. In this paper, we examine the causal effect of studying on grade performance using an Instrumental Variable estimator. Our approach takes advantage of a unique natural experiment and is possible because we have collected unique longitudinal data that provides detailed information about all aspects of this experiment. Important for understanding the potential impact of a wide array of education policies, the results suggest that human capital accumulation is far from predetermined at the time of college entrance.

How much does studying matter?

Education

Evidence about the Potential Role for Affirmative Action in Higher Education

In two recent cases involving the University of Michigan (Gratz v. Bollinger and Gruttinger v. Bollinger), the Supreme Court examined whether race should be allowed to play an explicit role in the admission decisions of schools. The arguments made in support of affirmative action admission policies in these cases and others raise two fundamental questions. First, do students actually have incorrect beliefs about individuals from different races at the time of college entrance? Second, if students do have incorrect beliefs at the time of college entrance, can diversity on a college campus change these beliefs? While a small literature has recently shed some light on the second question, no previous work has been able to provide direct evidence about the first one. In this paper we examine the first question by taking advantage of unique data collected specifically for this purpose.

Affirmative action and interracial friendships

In two recent cases involving the University of Michigan, the Supreme Court examined whether race should be allowed to play an explicit role in the admission decisionsof schools. The primary argument in these court cases and others has been that racialdiversity strengthens the quality of education ofered to all students. Underlying thisargument is the notion that educational benefits arise if interactions between studentsof different races improve preparation for life after college by, among other things, fostering mutual understanding and correcting misperceptions. A comprehensive study ofthis issue would ideally examine two conditions: first, whether students actually haveincorrect perceptions about their friendship compatibility with students of other racesat the time of college entrance; second, if misperceptions exist, whether diversity oncampus is effective in changing students' beliefs about individuals of different races.In this paper we provide, to the best of our knowledge, the first direct evidence aboutboth conditions by taking advantage of unique new data that was collected specificallyfor this purpose.