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Factors Affecting College Attainment and Student Ability in the U.S. since 1900

Author

Listed:
  • Kevin Donovan

    (Yale University)

  • Christopher Herrington

    (Virginia Commonwealth University)

Abstract

We develop a dynamic lifecycle model to study long-run changes in college completion and the relative ability of college versus non-college students in the early twentieth century. The model is disciplined in part by constructing a historical time series on real college costs from printed government documents dating to 1916. The model captures nearly all of the increase in attainment and ability sorting between college and non-college individuals between the 1900 to 1950 birth cohorts. Time variation in college costs, the college earnings premium, and the precision of ability signals all play a critical role for explaining different data moments and time periods, primarily through their interaction with binding borrowing constraints. Our quantitative results imply that attainment is broadly driven by the interaction of changing real college costs and the rising earnings premium, while ability sorting is driven by the earnings premium and increasing precision of ability signals. (Copyright: Elsevier)

Suggested Citation

  • Kevin Donovan & Christopher Herrington, 2019. "Factors Affecting College Attainment and Student Ability in the U.S. since 1900," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 31, pages 224-244, January.
  • Handle: RePEc:red:issued:17-9
    DOI: 10.1016/j.red.2018.07.003
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    File URL: http://dx.doi.org/10.1016/j.red.2018.07.003
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    References listed on IDEAS

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    1. Oksana Leukhina & Lutz A. Hendricks, 2011. "The Return to College: Selection Bias and Dropout Risk," 2011 Meeting Papers 311, Society for Economic Dynamics.
    2. Hendricks, Lutz & Schoellman, Todd, 2014. "Student abilities during the expansion of US education," Journal of Monetary Economics, Elsevier, vol. 63(C), pages 19-36.
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    5. 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.
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    9. John Bailey Jones & Fang Yang, 2016. "Skill-Biased Technical Change and the Cost of Higher Education," Journal of Labor Economics, University of Chicago Press, vol. 34(3), pages 621-662.
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    13. John Bound & Sarah Turner, 2002. "Going to War and Going to College: Did World War II and the G.I. Bill Increase Educational Attainment for Returning Veterans?," Journal of Labor Economics, University of Chicago Press, vol. 20(4), pages 784-815, October.
    14. Felicia Ionescu, 2009. "The Federal Student Loan Program: Quantitative Implications for College Enrollment and Default Rates," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 12(1), pages 205-231, January.
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    18. Adam Blandin & Christopher Herrington, 2018. "Family Structure, Human Capital Investment, and Aggregate College Attainment," 2018 Meeting Papers 446, Society for Economic Dynamics.
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    Cited by:

    1. Julien Albertini & Arthur Poirier & Anthony Terriau, 2020. "The impact of EITC on education, labor market trajectories, and inequalities," Working Papers halshs-03082382, HAL.
    2. Yang, Guanyi & Casner, Ben, 2021. "How much does schooling disutility matter?," Research in Economics, Elsevier, vol. 75(1), pages 87-95.
    3. Lutz Hendricks & Christopher Herrington & Todd Schoellman, 2016. "The Changing Roles of Family Income and Academic Ability for US College Attendance," Working Papers 1602, VCU School of Business, Department of Economics, revised Apr 2017.
    4. Todd Schoellman & Christopher Herrington & Lutz Hendricks, 2015. "Family Background, Academic Ability, and College Decisions in the 20th Century U.S," 2015 Meeting Papers 465, Society for Economic Dynamics.
    5. Lutz Hendricks & Christopher Herrington & Todd Schoellman, 2018. "College Access and Attendance Patterns: A Long-Run View," Opportunity and Inclusive Growth Institute Working Papers 10, Federal Reserve Bank of Minneapolis.
    6. Lutz Hendricks & Christopher Herrington & Todd Schoellman, 2021. "College Quality and Attendance Patterns: A Long-Run View," American Economic Journal: Macroeconomics, American Economic Association, vol. 13(1), pages 184-215, January.

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    More about this item

    Keywords

    College attainment; Student ability; Bowworing constraints; College costs; Education premia;
    All these keywords.

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • N31 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - U.S.; Canada: Pre-1913

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