The Impact of Price Caps and Spending Cuts on U.S. Postsecondary Attainment / David J. Deming, Christopher R. Walters.

Format:

Book

Author/Creator:

Deming, David J.

Contributor:

National Bureau of Economic Research.

Walters, Christopher R.

Series:

Working Paper Series (National Bureau of Economic Research) no. w23736.

NBER working paper series no. w23736

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2017.

Summary:

Increasing the postsecondary attainment rate of college-age youth is an important economic priority in the U.S. and in other developed countries. Yet little is known about whether different forms of public subsidy can increase degree completion. In this paper, we compare the impact of the marginal taxpayer dollar on postsecondary attainment when it is spent on lowering tuition prices versus increasing the quality of the college experience. We do so by estimating the causal impact of changes in tuition and spending on enrollment and degree completion in U.S. public postsecondary institutions between 1990 and 2013. We estimate these impacts using a newly assembled data set of legislative tuition caps and freezes, combined with variation in exposure to state budget shocks that is driven by differences in historical reliance on state appropriations. We find large impacts of spending on enrollment and degree completion. In contrast, we find no impact of price changes. Our estimates suggest that spending increases are more effective per-dollar than price cuts as a means of increasing postsecondary attainment.

Notes:

Print version record

August 2017.