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Author: Mustafa, Shoumi
Resulting in 1 citation.
1. Mustafa, Shoumi
Three Essays on College Enrollment, Completion and Labor Market Returns
Ph.D. Dissertation, Department of Economics, Ohio State University, 2003.
Cohort(s): NLSY79
Publisher: Department of Economics, The Ohio State University
Keyword(s): College Education; College Enrollment; Endogeneity; Financial Assistance; Higher Education; Labor Market Outcomes; Racial Differences; Tuition

Permission to reprint the abstract has not been received from the publisher.

The Effects of Financial Aid on College Completion
I examine effects of grant aid and education loan amounts on the college completion decision of students attending four-year colleges. The goal is to determine whether a given amount of financial aid reduces the dropout probability, and whether it has differential effects when given as grants versus loans. Using data from the Second Follow-up Survey of the 1994 Beginning Post-secondary Students Longitudinal Study, I estimate a probit model of the college dropout decision, accounting for the endogeneity of grant and loan amounts. My estimates show that grants reduce the dropout probability although loans do not affect individuals' college completion decisions. The result suggests that current federal government policies of promoting loans as the main form of financial aid (in higher education) are not consistent with the stated objective of increasing access to college. Education loans are found to influence college quality choices of meritorious students from low to middle income families.

The Effects of State Characteristic College Enrollment
I examine how state policies on tuition, grant aid and appropriations influence high school graduates' two-year versus four-year college attendance decisions. Using data from 1994-99 October Supplements of the Current Population Survey, I estimate a multinomial logit model of college choice. My estimates show that higher four-year college tuition motivates prospective students to attend two-year colleges. I also find positive effects of two-year college appropriations on two-year college attendance. These results illustrate the on-going interaction of state policies and individual decisions. In recent years, increased earnings of college educated individuals have resulted in large increases in college enrollments. States have adjusted to the enrollment pressure by raising four-year college tuition. In response, students have switched to two-year colleges, requiring states to allocate larger amounts to such colleges.

Reconciling Estimates of Labor Market Returns to College Quality
Rapid increases in the cost of attending higher quality colleges have contributed to a growing literature on the relationship between college quality and student earnings. In a group of nine such studies, analysts find positive earnings effects of college quality but fail to agree on its magnitude. Because these studies differ with respect to a variety of methodological and data related issues, it is not possible to ascertain how each of these differences influences the estimates. I consider a large set of factor that distinguish the studies and examine the sensitivity of the estimates to each of the factors, using two large micro data sets, the First Follow-up Survey of the Baccalaureate and Beyond Study and the 1979 National Longitudinal Survey of Youth. My estimates show that college quality effects differ between blacks and whites, college graduates and dropouts and also between young and older students. I also find that correcting for the endogeneity of college quality variables increases estimates of college quality effects, implying that costs of attendance constrain individuals' college quality choices.

Bibliography Citation
Mustafa, Shoumi. Three Essays on College Enrollment, Completion and Labor Market Returns. Ph.D. Dissertation, Department of Economics, Ohio State University, 2003..