| Title: |
Understanding the income gradient in college attendance in mexico: The role of heterogeneity in expected returns to college. SIEPR Working Paper |
| Authors: |
Katja Maria Kaufmann; Jel-classification I; Lance Lochner; Michael Lovenheim; Aprajit Mahajan; Chuck Manski; Shaun Mcrae; Sriniketh Nagavarapu |
| Contributors: |
The Pennsylvania State University CiteSeerX Archives |
| Source: |
http://www.qeconomics.org/upcoming/259/259-2.pdf. |
| Publication Year: |
2008 |
| Collection: |
CiteSeerX |
| Subject Terms: |
Schooling Choice; Credit Constraints; Subjective Expectations; Marginal Returns to Schooling; Local Instrumental Variables Approach |
| Description: |
Differences in college enrollment between poor and rich are striking in Latin Amer-ica. Explanations such as differences in “college preparedness ” and “credit constraints” have been advanced. An alternative explanation could be differences in information sets between poor and rich, for example about career opportunities, translating into different expected returns to college. Poor people might expect low returns and thus decide not to attend. Or they might face high (unobserved) costs that prevent them from attending despite high expected returns. I use data on people’s subjective expec-tations of returns to address this identification problem. I find that poor individuals require higher expected returns to be induced to attend college than individuals from rich families. Testing predictions of a model of college attendance shows that poor individuals are particularly responsive to changes in direct costs, which is consistent with them being credit constrained. Performing counterfactual policy experiments, I find that a sizeable fraction of poor individuals would change their decision in response to a reduction in direct costs and that these individuals at the margin have expected |
| Document Type: |
text |
| File Description: |
application/pdf |
| Language: |
English |
| Relation: |
http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.641.1832 |
| Availability: |
http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.641.1832; http://www.qeconomics.org/upcoming/259/259-2.pdf |
| Rights: |
Metadata may be used without restrictions as long as the oai identifier remains attached to it. |
| Accession Number: |
edsbas.25B412E5 |
| Database: |
BASE |