Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/21423 
Year of Publication: 
2002
Series/Report no.: 
IZA Discussion Papers No. 518
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
This paper examines the family income?college enrollment relationship and the evidence on credit constraints in post-secondary schooling. We distinguish short-run liquidity constraints from the long-term factors that promote cognitive and noncognitive ability. Long-run factors crystallized in ability are the major determinants of the family income?schooling relationship, although there is some evidence that up to 8% of the U.S. population is credit constrained in a short-run sense. Evidence that IV estimates of the returns to schooling exceed OLS estimates is sometimes claimed to support the existence of substantial credit constraints. This argument is critically examined.
Subjects: 
human capital
return to education
credit constraints
JEL: 
H43
D33
I28
Document Type: 
Working Paper

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