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The Effect of Postsecondary Educational Institutions on Local Economies: A Bird’s-Eye View

Author

Listed:
  • Patrick Lehnert
  • Madison Dell
  • Uschi Backes-Gellner
  • Eric Bettinger

Abstract

Despite worldwide expansion of higher education, the impact of higher education institutions on local economic activity is still poorly understood. We analyze the local economic effects of branch campus openings in Tennessee and Texas, two states representative of the underlying U.S. enrollment patterns. To overcome the lack of adequate data, we use a novel proxy for regional economic activity based on daytime satellite imagery. Applying different panel methods—traditional difference-in-differences (DD), heterogeneity-robust DD, and instrumental variables—we find positive effects. Independent data show an increase in college graduates and employment in the sectors aligned with programs offered at branch campuses.

Suggested Citation

  • Patrick Lehnert & Madison Dell & Uschi Backes-Gellner & Eric Bettinger, 2024. "The Effect of Postsecondary Educational Institutions on Local Economies: A Bird’s-Eye View," NBER Working Papers 32679, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:32679
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    Cited by:

    1. is not listed on IDEAS
    2. Robert Kelchen & Dubravka Ritter & Douglas A. Webber, 2024. "Predicting College Closures and Financial Distress," NBER Chapters, in: Financing Institutions of Higher Education, pages 103-162, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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