Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/197664
Authors: 
Montoya, Ana Maria
Noton Norambuena, Carlos
Solis, Alex
Year of Publication: 
2018
Series/Report no.: 
Working Paper 2018:12
Abstract: 
To estimate causal effects of college choice, we exploit eligibility rules for student loans in a regression discontinuity design. Loan programs induce students to pursue college degrees that are more expensive and prolonged relative to technical education. Although higher education is profitable, the marginal return of college is identical to that of technical education when students are about 30 years old. The college premium seems to increase over time, possibly offsetting the initial experience gap and covering cost differences under moderate discount rates. We study the effects of debt burden on college choice using a similar cutoff rule for scholarships.
Subjects: 
college choice
credit constraints
returns to college
debt aversion
regression discontinuity
JEL: 
I22
I23
I26
I28
J08
Persistent Identifier of the first edition: 
Document Type: 
Working Paper
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