Department of Economics
SE-751 20 Uppsala, Sweden
Institutional Affiliation: Uppsala University
Information about this author at RePEc
NBER Working Papers and Publications
|May 2020||Measuring the Effect of Student Loans on College Persistence|
with : w27269
Governments around the world use grant and loan programs to ease the financial constraints that contribute to socioeconomic gaps in college completion. A growing body of research assesses the impact of grants; less is known about how loan programs affect persistence and degree completion. We use detailed administrative data from Chile to provide rigorous regression-discontinuity-based evidence on the impacts of loan eligibility for university students who retake the national admission test after their first year of studies. Those who score above a certain threshold become eligible for loans covering around 85% of tuition costs for the duration of their program. We find that access to loans increases the fraction who return to university for a second year by 20 percentage points, with two-t...