IDEAS home Printed from https://ideas.repec.org/a/eee/jeborg/v164y2019icp331-356.html
   My bibliography  Save this article

The effects of the 2006 tuition fee reform and the Great Recession on university student dropout behaviour in the UK

Author

Listed:
  • Bradley, Steve
  • Migali, Giuseppe

Abstract

This paper investigates the causal effect of the Great Recession, and a conditional effect of a tuition fee reform, on the risk of students dropping out of HE. We use HESA data and our analysis combines duration modelling with difference-in-differences. We find that the causal effect of the recession increases the risk of drop out, especially for males. A smaller and positive effect of the tuition fee reform for males, whereas we observe the opposite effect for females. Differences in dropout behaviour are also found for high and low income groups, and between different types of university and subjects studied.

Suggested Citation

  • Bradley, Steve & Migali, Giuseppe, 2019. "The effects of the 2006 tuition fee reform and the Great Recession on university student dropout behaviour in the UK," Journal of Economic Behavior & Organization, Elsevier, vol. 164(C), pages 331-356.
    • Handle: RePEc:eee:jeborg:v:164:y:2019:i:c:p:331-356
    DOI: 10.1016/j.jebo.2019.06.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167268119301921
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jebo.2019.06.002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Berge, Wiljan van den, 2018. "Bad start, bad match? The early career effects of graduating in a recession for vocational and academic graduates," Labour Economics, Elsevier, vol. 53(C), pages 75-96.
    2. Vignoles Anna F & Powdthavee Nattavudh, 2009. "The Socioeconomic Gap in University Dropouts," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 9(1), pages 1-36, April.
    3. Helena Skyt Nielsen & Torben Sørensen & Christopher Taber, 2010. "Estimating the Effect of Student Aid on College Enrollment: Evidence from a Government Grant Policy Reform," NBER Chapters, in: Income Taxation, Trans-Atlantic Public Economics Seminar (TAPES), pages 185-215, National Bureau of Economic Research, Inc.
    4. James J. Heckman, 1976. "The Common Structure of Statistical Models of Truncation, Sample Selection and Limited Dependent Variables and a Simple Estimator for Such Models," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 475-492, National Bureau of Economic Research, Inc.
    5. Azmat, Ghazala & Simion, Stefania, 2017. "Higher Education Funding Reforms: A Comprehensive Analysis of Educational and Labor Market Outcomes in England," CEPR Discussion Papers 12389, C.E.P.R. Discussion Papers.
    6. Jeremy P. Smith & Robin A. Naylor, 2001. "Dropping out of university: A statistical analysis of the probability of withdrawal for UK university students," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 164(2), pages 389-405.
    7. Jenkins, Stephen P, 1995. "Easy Estimation Methods for Discrete-Time Duration Models," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 57(1), pages 129-138, February.
    8. Ralph Stinebrickner & Todd Stinebrickner, 2008. "The Effect of Credit Constraints on the College Drop-Out Decision: A Direct Approach Using a New Panel Study," American Economic Review, American Economic Association, vol. 98(5), pages 2163-2184, December.
    9. Kahn, Lisa B., 2010. "The long-term labor market consequences of graduating from college in a bad economy," Labour Economics, Elsevier, vol. 17(2), pages 303-316, April.
    10. Jacob Arendt, 2013. "The effect of public financial aid on dropout from and completion of university education: evidence from a student grant reform," Empirical Economics, Springer, vol. 44(3), pages 1545-1562, June.
    11. Rees, Daniel I. & Mocan, H. Naci, 1997. "Labor market conditions and the high school dropout rate: Evidence from New York State," Economics of Education Review, Elsevier, vol. 16(2), pages 103-109, April.
    12. Yorman Ben-Porath, 1970. "The Production of Human Capital Over Time," NBER Chapters, in: Education, Income, and Human Capital, pages 129-154, National Bureau of Economic Research, Inc.
    13. Arulampalam, Wiji & Naylor, Robin A. & Smith, Jeremy P., 2005. "Effects of in-class variation and student rank on the probability of withdrawal: cross-section and time-series analysis for UK university students," Economics of Education Review, Elsevier, vol. 24(3), pages 251-262, June.
    14. Susan M. Dynarski, 2003. "Does Aid Matter? Measuring the Effect of Student Aid on College Attendance and Completion," American Economic Review, American Economic Association, vol. 93(1), pages 279-288, March.
    15. Claire Crawford, 2014. "Socio-economic differences in university outcomes in the UK: drop-out, degree completion and degree class," IFS Working Papers W14/31, Institute for Fiscal Studies.
    16. Sauro Mocetti, 2012. "Educational choices and the selection process: before and after compulsory schooling," Education Economics, Taylor & Francis Journals, vol. 20(2), pages 189-209, February.
    17. James J. Heckman, 1976. "Introduction to "Annals of Economic and Social Measurement, Volume 5, number 4"," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, National Bureau of Economic Research, Inc.
    18. Matthew T. Johnson, 2013. "Borrowing Constraints, College Enrollment, and Delayed Entry," Journal of Labor Economics, University of Chicago Press, vol. 31(4), pages 669-725.
    19. Dearden, Lorraine & Fitzsimons, Emla & Wyness, Gill, 2014. "Money for nothing: Estimating the impact of student aid on participation in higher education," Economics of Education Review, Elsevier, vol. 43(C), pages 66-78.
    20. Rothstein, Jesse & Rouse, Cecilia Elena, 2011. "Constrained after college: Student loans and early-career occupational choices," Journal of Public Economics, Elsevier, vol. 95(1), pages 149-163.
    21. Narendranathan, W & Stewart, Mark B, 1993. "How Does the Benefit Effect Vary as Unemployment Spells Lengthen?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 8(4), pages 361-381, Oct.-Dec..
    22. Massimiliano Bratti, 2007. "Parents’ income and children’s school drop-out at 16 in England and Wales: evidence from the 1970 British Cohort Study," Review of Economics of the Household, Springer, vol. 5(1), pages 15-40, March.
    23. Bell, David N.F. & Blanchflower, David G., 2010. "UK Unemployment in the Great Recession," National Institute Economic Review, National Institute of Economic and Social Research, vol. 214, pages 3-25, October.
    24. Richard Murphy & Judith Scott-Clayton & Gill Wyness, 2017. "The end of free college in England," CentrePiece - The magazine for economic performance 503, Centre for Economic Performance, LSE.
    25. repec:mpr:mprres:7891 is not listed on IDEAS
    26. Erica Field, 2009. "Educational Debt Burden and Career Choice: Evidence from a Financial Aid Experiment at NYU Law School," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 1-21, January.
    27. David M. Linsenmeier & Harvey S. Rosen & Cecilia Elena Rouse, 2006. "Financial Aid Packages and College Enrollment Decisions: An Econometric Case Study," The Review of Economics and Statistics, MIT Press, vol. 88(1), pages 126-145, February.
    28. Ermisch, John & Francesconi, Marco, 2001. "Family Matters: Impacts of Family Background on Educational Attainments," Economica, London School of Economics and Political Science, vol. 68(270), pages 137-156, May.
    29. Nicoletti, Cheti & Rondinelli, Concetta, 2010. "The (mis)specification of discrete duration models with unobserved heterogeneity: A Monte Carlo study," Journal of Econometrics, Elsevier, vol. 159(1), pages 1-13, November.
    30. Lofstrom, Magnus, 2007. "Why Are Hispanic and African-American Dropout Rates So High?," IZA Discussion Papers 3265, Institute of Labor Economics (IZA).
    31. Mark Taylor & Tina Rampino, 2014. "Educational Aspirations and Attitudes over the Business Cycle," Economica, London School of Economics and Political Science, vol. 81(324), pages 649-673, October.
    32. Charles F. Manski, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(3), pages 531-542.
    33. Matthew T. Johnson, 2013. "Borrowing Constraints, College Enrollment, and Delayed Entry," Mathematica Policy Research Reports 57fc00235c3a47ff92cb253f9, Mathematica Policy Research.
    34. Ghazala Azmat & Stefania Simion, 2018. "Higher education funding reforms in England," CentrePiece - The magazine for economic performance 536, Centre for Economic Performance, LSE.
    35. Oreopoulos, Philip, 2007. "Do dropouts drop out too soon? Wealth, health and happiness from compulsory schooling," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2213-2229, December.
    36. Philip Oreopoulos & Till von Wachter & Andrew Heisz, 2012. "The Short- and Long-Term Career Effects of Graduating in a Recession," American Economic Journal: Applied Economics, American Economic Association, vol. 4(1), pages 1-29, January.
    37. Lancaster,Tony, 1992. "The Econometric Analysis of Transition Data," Cambridge Books, Cambridge University Press, number 9780521437899.
    38. Tumino, Alberto & P. Taylor, Mark, 2015. "The impact of local labour market conditions on school leaving decisions," ISER Working Paper Series 2015-14, Institute for Social and Economic Research.
    39. Erica Blom & Brian C. Cadena & Benjamin J. Keys, 2021. "Investment over the Business Cycle: Insights from College Major Choice," Journal of Labor Economics, University of Chicago Press, vol. 39(4), pages 1043-1082.
    40. Effrosyni Adamopoulou & Giulia Martina Tanzi, 2017. "Academic Drop-Out and the Great Recession," Journal of Human Capital, University of Chicago Press, vol. 11(1), pages 35-71.
    41. John Ermisch & Marco Francesconi, 2001. "Family Matters: Impacts of Family Background on Educational Attainments," Economica, London School of Economics and Political Science, vol. 68(270), pages 137-156, May.
    42. Keane, Michael P & Wolpin, Kenneth I, 2001. "The Effect of Parental Transfers and Borrowing Constraints on Educational Attainment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(4), pages 1051-1103, November.
    43. Geraint Johnes & Robert McNabb, 2004. "Never Give up on the Good Times: Student Attrition in the UK," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 66(1), pages 23-47, February.
    44. Zvi Eckstein & Kenneth I. Wolpin, 1999. "Why Youths Drop Out of High School: The Impact of Preferences, Opportunities, and Abilities," Econometrica, Econometric Society, vol. 67(6), pages 1295-1340, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Carmen Aina & Chiara Mussida & Gabriele Lombardi, 2023. "Are Business and Economics Alike?," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 9(2), pages 557-585, July.
    2. Babatunde Buraimo & Giuseppe Migali & Rob Simmons, 2022. "Impacts of the Great Recession on sport: evidence from English Football League attendance demand [US household tourism expenditure and the great recession: an analysis with the consumer expenditure," Oxford Economic Papers, Oxford University Press, vol. 74(1), pages 155-177.
    3. Aina, Carmen & Baici, Eliana & Casalone, Giorgia & Pastore, Francesco, 2022. "The determinants of university dropout: A review of the socio-economic literature," Socio-Economic Planning Sciences, Elsevier, vol. 79(C).
    4. Barbara Sadaba & Sunčica Vujič & Sofia Maier, 2020. "Cyclicality of Schooling: New Evidence from Unobserved Components Models," Staff Working Papers 20-38, Bank of Canada.
    5. Sadaba, Barbara & Vujić, Sunčica & Maier, Sofia, 2024. "Characterizing the schooling cycle," Economic Modelling, Elsevier, vol. 132(C).
    6. Jennifer Graves & Zoë Kuehn, 2022. "Higher education decisions and macroeconomic conditions at age eighteen," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 13(1), pages 171-241, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Steve Bradley & Giuseppe Migali, 2015. "The Effect of a Tuition Fee Reform on the Risk of Drop Out from University in the UK," Working Papers 86010138, Lancaster University Management School, Economics Department.
    2. Rossella Iraci Capuccinello, 2014. "Determinants and timing of dropping out decisions: evidence from the UK FE sector," Working Papers 15742191, Lancaster University Management School, Economics Department.
    3. Elena Mattana & Juanna Joensen, 2016. "Student Aid, Academic Achievement, and Labor Market Behavior," 2016 Meeting Papers 1102, Society for Economic Dynamics.
    4. Aina, Carmen & Baici, Eliana & Casalone, Giorgia & Pastore, Francesco, 2022. "The determinants of university dropout: A review of the socio-economic literature," Socio-Economic Planning Sciences, Elsevier, vol. 79(C).
    5. Elena Mattana & Juanna Joensen, 2014. "Student Aid, Academic Achievement, and Labor Market Behavior: Grants or Loans?," 2014 Meeting Papers 707, Society for Economic Dynamics.
    6. Rossella Iraci Capuccinello & Steve Bradley, 2014. "The effect of college mergers on student dropout behaviour," Working Papers 64907218, Lancaster University Management School, Economics Department.
    7. George Bulman & Robert Fairlie & Sarena Goodman & Adam Isen, 2021. "Parental Resources and College Attendance: Evidence from Lottery Wins," American Economic Review, American Economic Association, vol. 111(4), pages 1201-1240, April.
    8. Aguirre, Josefa, 2021. "Long-term effects of grants and loans for vocational education," Journal of Public Economics, Elsevier, vol. 204(C).
    9. Helena Skyt Nielsen & Torben Sørensen & Christopher Taber, 2010. "Estimating the Effect of Student Aid on College Enrollment: Evidence from a Government Grant Policy Reform," American Economic Journal: Economic Policy, American Economic Association, vol. 2(2), pages 185-215, May.
    10. Bednar, Steven & Gicheva, Dora, 2013. "Tax benefits for graduate education: Incentives for whom?," Economics of Education Review, Elsevier, vol. 36(C), pages 181-197.
    11. Buly A. Cardak & Joe Vecci, 2016. "Graduates, Dropouts and Slow Finishers: The Effects of Credit Constraints on University Outcomes," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 78(3), pages 323-346, June.
    12. Sieg, Holger & Wang, Yu, 2018. "The impact of student debt on education, career, and marriage choices of female lawyers," European Economic Review, Elsevier, vol. 109(C), pages 124-147.
    13. Holger Sieg & Yu Wang, 2017. "The Impact of Student Debt on Education, Career, and Marriage Choices of Female Lawyers," NBER Working Papers 23453, National Bureau of Economic Research, Inc.
    14. Alexandre de Gendre & Jan Kabátek, 2021. "From subsidies to loans: The effects of a national student finance reform on the choices of secondary school students," Melbourne Institute Working Paper Series wp2021n12, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    15. Rothstein, Jesse & Rouse, Cecilia Elena, 2011. "Constrained after college: Student loans and early-career occupational choices," Journal of Public Economics, Elsevier, vol. 95(1-2), pages 149-163, February.
    16. Aina, Carmen & Baici, Eliana & Casalone, Giorgia & Pastore, Francesco, 2018. "The Economics of University Dropouts and Delayed Graduation: A Survey," IZA Discussion Papers 11421, Institute of Labor Economics (IZA).
    17. Hassani-Nezhad, Lena & Anderberg, Dan & Chevalier, Arnaud & Lührmann, Melanie & Pavan, Ronni, 2021. "Higher education financing and the educational aspirations of teenagers and their parents," Economics of Education Review, Elsevier, vol. 85(C).
    18. Lutz Hendricks & Oksana Leukhina, 2018. "The Return To College: Selection And Dropout Risk," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(3), pages 1077-1102, August.
    19. Giuseppe Migali & Eugenio Zucchelli, 2014. "The relationship between forgone health care and high school dropout," Working Papers 71679142, Lancaster University Management School, Economics Department.
    20. Avdic, Daniel & Gartell, Marie, 2015. "Working while studying? Student aid design and socioeconomic achievement disparities in higher education," Labour Economics, Elsevier, vol. 33(C), pages 26-40.

    More about this item

    Keywords

    Tuition fee reform; Recession; University dropouts;
    All these keywords.

    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jeborg:v:164:y:2019:i:c:p:331-356. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jebo .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.