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Working Paper
The Effect of Shocks to College Revenues on For-Profit Enrollment: Spillover from the Public Sector
This paper investigates whether declines in public funding for post-secondary institutions have increased for-profit enrollment. The two primary channels through which funding might operate to reallocate students across sectors are price (measured by tuition) and quality (measured by resource constraints). We estimate, on average, that a 10 percent cut in appropriations raises tuition about 1 to 2 percent and decreases faculty resources by 1/2 to 1 percent, creating substantial bottlenecks for prospective students on both price and quality. These cuts, in turn, generate a nearly one ...
Discussion Paper
The Affordable Care Act and For-Profit Colleges
Getting health insurance in America is intimately connected to choosing whether and where to work. Therefore, it should not be surprising that the U.S. health insurance market may influence, and be influenced by, the market for higher education—which itself is closely tied to the labor market. In this post, and the staff report it is based on, we investigate the effects of the largest overhaul of health insurance in the United States in recent decades—the Patient Protection and Affordable Care Act of 2010 (ACA) -- on college enrollment choices.
Discussion Paper
Student Loan Repayment and College Accountability
Student loan debt and defaults have been steadily rising, igniting public worry about the associated public and private risks. This has led to controversial attempts to curb defaults by holding colleges, particularly those in the for-profit sector, increasingly accountable for the student loan repayment behavior of their students. These efforts attempt to protect taxpayers against the misuse of public money used to encourage college enrollment and to safeguard students against potentially risky human capital investments. Recent policy proposals penalize colleges for students? poor repayment ...
Working Paper
WHERE DO STUDENTS GO WHEN FOR-PROFIT COLLEGES LOSE FEDERAL AID?
Recent federal investigations and new regulations have resulted in restrictions on for-profit institutions? access to federal student aid. We examine the enrollment effects of similar restrictions imposed on over 1,200 for-profit colleges in the 1990s. Using variation in regulations linked to student loan default rates, we estimate the impact of the loss of federal aid on the enrollment of Pell Grant recipients in sanctioned institutions and their local competitors. Enrollment in a sanctioned for-profit college declines by 53 percent in the five years following a sanction. For-profit ...