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Credit towards graduation: The impact of US bank deregulation on human capital accumulation

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  • Reilly, Patrick A.

Abstract

Credit markets affect the real economy. It is important to identify unintended consequences of financial policies. This paper studies the impact of bank branching deregulation on high school graduation. The use of National Longitudinal Survey of Youth 1979 geocoded data focuses the results on three deregulations: Ohio in 1979, Connecticut in 1980, and Alabama in 1981. Discontinuities in treatment assignment at borders between deregulated states and regulated states identify the effect of banking deregulation on high school graduation. Using a regression discontinuity type set up called differences-in-discontinuities, results indicate significant increases in the likelihood of high school graduation for treated individuals. Analysis provides evidence of heterogeneous effects of bank branching deregulation based on skill level and income level.

Suggested Citation

  • Reilly, Patrick A., 2020. "Credit towards graduation: The impact of US bank deregulation on human capital accumulation," The North American Journal of Economics and Finance, Elsevier, vol. 51(C).
    • Handle: RePEc:eee:ecofin:v:51:y:2020:i:c:s1062940819301524
    DOI: 10.1016/j.najef.2019.101085
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    More about this item

    Keywords

    Bank branching; Credit constraints; Education;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor

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