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Did Gainful Employment Regulations Result in College and Program Closures?

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  • Robert Kelchen
  • Zhuoyao Liu

Abstract

For decades, the federal government has expected vocationally focused programs in higher education, especially among for-profit colleges, to lead to gainful employment in a profession. In the mid-2010s, the U.S. Department of Education developed gainful employment (GE) regulations that sought to tie a program's federal financial aid eligibility to graduates' debt-to-earnings ratios. We use a regression discontinuity design to examine whether for-profit programs' performance on GE was associated with the likelihood of closing the program or college. Although the regulations were repealed before any program lost federal funding, we find that passing GE regulations was associated with a lower likelihood of program and college closures.

Suggested Citation

  • Robert Kelchen & Zhuoyao Liu, 2022. "Did Gainful Employment Regulations Result in College and Program Closures?," Education Finance and Policy, MIT Press, vol. 17(3), pages 454-478, Summer.
    • Handle: RePEc:tpr:edfpol:v:17:y:2022:i:3:p:454-478
    DOI: 10.1162/edfp_a_00340
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    Cited by:

    1. Juan Esteban Carranza & María Marta Ferreyra & Ana Maria Gazmuri, 2023. "The Dynamic Market for Short-Cycle Higher Education Programs," Borradores de Economia 1265, Banco de la Republica de Colombia.

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