Marginal Returns to Public Universities / Jack Mountjoy.

Format:

Book

Author/Creator:

Mountjoy, Jack.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w32296.

NBER working paper series no. w32296

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2024.

Summary:

This paper studies the causal impacts of public universities on the outcomes of their marginally admitted students. I use administrative admission records spanning all 35 public universities in Texas, which collectively enroll 10 percent of American public university students, to systematically identify and employ decentralized cutoffs in SAT/ACT scores that generate discontinuities in admission and enrollment. The typical marginally admitted student completes an additional year of education in the four-year sector, is 12 percentage points more likely to earn a bachelor's degree, and eventually earns 5-10 percent more than their marginally rejected but otherwise identical counterpart. Marginally admitted students pay no additional tuition costs thanks to offsetting grant aid; cost-benefit calculations show internal rates of return of 19-23 percent for the marginal students themselves, 10-12 percent for society (which must pay for the additional education), and 3-4 percent for the government budget. Finally, I develop a method to disentangle separate effects for students on the extensive margin of the four-year sector versus those who would fall back to another four-year school if rejected. Substantially larger extensive margin effects drive the results.

Notes:

Print version record

April 2024.