This paper estimates a dynamic model of schooling attainment to investigate the sources of discrepancy by race and ethnicity in college attendance. When the returns to college education rose, college enrollment of whites responded much more quickly than that of minorities. Parental income is a strong predictor of this response. However, using NLSY data, we find that it is the long-run factors associated with parental background and income and not short-term credit constraints facing college students that account for the differential response by race and ethnicity to the new labor market for skilled labor. Policies aimed at improving these long-term factors are far more likely to be successful in eliminating college attendance differentials than are short-term tuition reduction policies.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
7249.
Length: Date of creation: Jul 1999 Date of revision: Handle: RePEc:nbr:nberwo:7249
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