NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Alex Solis

Department of Economics
Uppsala University
Box 513
SE-751 20 Uppsala, Sweden

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: Uppsala University

NBER Working Papers and Publications

May 2020Measuring the Effect of Student Loans on College Persistence
with David Card: 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...
 
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