I combine a regression discontinuity design with rich data on academic and labor market outcomes for a large sample of Florida students to identify the returns to four-year college for students on the academic margin of college admission. In addition, I develop a theoretical model of college choice with and without credit constraints that allows for intuitive tests of the importance of credit constraints within this population. I find that students who obtain high school grades just above the threshold value for admissions eligibility at a large public university in Florida are much more likely to attend a four-year college and much less likely to attend a community college than students with grades just below the threshold. The earnings returns to a year of four-year college for affected students are 8.7 percent, nearly identical to returns to college for the population of Florida high school students. Consistent with the credit constraints hypothesis, poorer students who are more likely to be credit constrained work more while in college and realize higher post-college returns.
We use cookies to provide you with an optimal website experience. This includes cookies that are necessary for the operation of the site as well as cookies that are only used for anonymous statistical purposes, for comfort settings or to display personalized content. You can decide for yourself which categories you want to allow. Please note that based on your settings, you may not be able to use all of the site's functions.
Cookie settings
These necessary cookies are required to activate the core functionality of the website. An opt-out from these technologies is not available.
In order to further improve our offer and our website, we collect anonymous data for statistics and analyses. With the help of these cookies we can, for example, determine the number of visitors and the effect of certain pages on our website and optimize our content.