IDEAS home Printed from
MyIDEAS: Login to save this article or follow this journal

Credit constraints in education: Evidence from international data

This paper tests empirically the credit-constraints thesis by using cross-country data on secondary and higher-education enrolment rates. Contrary to some previous works in this direction, we find several pieces of evidence that support the importance of such a thesis. First, controlling for the effects of both economic development and educational inequality, we find that school enrolments are negatively correlated with income inequality and positively correlated with financial-market development. Second, these correlations are robust to the specific country-effects, the composition of the sample of countries, and the inclusion of public education expenditures. Finally, public education expenditures are significantly correlated with school enrolment ratios. Distinguishing developed countries from developing ones reveals that the effects of both social and material factors are larger in rich countries than in poor ones. Our estimation results also show that the way public expenditures are allocated across educational levels affects enrolment ratios in higher educational stages. Specifically, countries where expenditure allocations are biased in favour of the advanced stages of education at the expense of the basic levels also experience low enrolment ratios in the higher levels of education.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Article provided by Universidad del CEMA in its journal Journal of Applied Economics.

Volume (Year): XI (2008)
Issue (Month): (May)
Pages: 33-60

in new window

Handle: RePEc:cem:jaecon:v:11:y:2008:n:1:p:33-60
Contact details of provider: Postal:
Av. Córdoba 374, (C1054AAP) Capital Federal

Phone: (5411) 6314-3000
Fax: (5411) 4314-1654
Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:cem:jaecon:v:11:y:2008:n:1:p:33-60. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Valeria Dowding)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.