Tuition, debt, and human capital

Arbeitspapier

This paper investigates the effects of college tuition on student debt and human capital accumulation. We exploit data from a random sample of undergraduate students in the United States and implement a research design that instruments for tuition with relatively large changes to the tuition of students who enrolled at the same school in different cohorts. We find that $10,000 in higher tuition causally reduces the probability of graduating with a graduate degree by 6.2 percentage points and increases student debt by $2,961. Higher tuition also reduces the probability of obtaining an undergraduate degree among poorer, credit-constrained students. Thus, the relatively large increases in the price of education in the United States in the past decade can affect the accumulation of human capital.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Staff Report ; No. 912

Classification and Topics

• Classification: Wirtschaft ; Household Saving; Personal Finance ; National Government Expenditures and Education ; Governmental Loans; Loan Guarantees; Credits; Grants; Bailouts ; Higher Education; Research Institutions ; Human Capital; Skills; Occupational Choice; Labor Productivity
• Subject: tuition ; student debt ; human capital ; credit constraints

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Chakrabarti, Rajashri ; Fos, Vyacheslav ; Liberman, Andres ; Yannelis, Constantine
• Event: Veröffentlichung
• (who): Federal Reserve Bank of New York
• (where): New York, NY
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/241105
• Last update: 10.03.2025, 11:43 AM CET