The Effect of Credit Constraints on the College Drop-Out Decision a Direct Approach Using a New Panel Study

41 Pages Posted: 24 Aug 2007 Last revised: 15 Dec 2022

See all articles by Todd R. Stinebrickner

Todd R. Stinebrickner

University of Western Ontario - Department of Economics

Ralph Stinebrickner

Berea College; University of Western Ontario

Date Written: August 2007

Abstract

A serious difficulty in determining the importance of credit constraints in education arises because standard data sources do not provide a direct way of identifying which students are credit constrained. This has forced researchers to adopt a variety of indirect approaches. This paper differentiates itself from previous work by taking a direct approach for providing evidence about this issue which is made possible by unique longitudinal data that have been collected specifically for this type of purpose. Our results suggest that, while credit constraints likely play an important role in the drop-out decisions of some students, the large majority of attrition of students from low income families should be primarily attributed to reasons other than credit constraints.

Suggested Citation

Stinebrickner, Todd R. and Stinebrickner, Ralph, The Effect of Credit Constraints on the College Drop-Out Decision a Direct Approach Using a New Panel Study (August 2007). NBER Working Paper No. w13340, Available at SSRN: https://ssrn.com/abstract=1008832

Todd R. Stinebrickner (Contact Author)

University of Western Ontario - Department of Economics ( email )

London, Ontario N6A 5B8
Canada

Ralph Stinebrickner

Berea College ( email )

Berea, KY 40404
United States

University of Western Ontario ( email )

1151 Richmond Street
Suite 2
London, Ontario N6A 5B8
Canada