Publications

This paper documents the bias introduced by attrition of individuals from administrative data sources with an application to the labor market consequences of postsecondary education. We show that attrition due to cross-state migration is non-trivial in this setting, and particularly problematic for high-earners, graduates from selective universities, and certain majors. Consequently, we estimate that the premium associated with graduating from a most selective university is 23% higher than one would estimate using only in-state earnings, though this magnitude differs across context. The impact of obtaining a 2-year CTE credential is also understated, as are earnings differences across majors. We show that differences in missingness are systematically related to bias in measurement, and suggest approaches to quantifying that bias.

NBER Working Paper 30232

Expenditures for U.S. higher education institutions totaled $712 billion in 2021–22. These expenditures encompass a range of institutional costs related to educational activities, including instruction, student services, and campus facilities. Postsecondary institutions have varying missions, resulting in different core costs and expenditure patterns. Community colleges primarily focus on instruction, while large universities also conduct research, provide housing, and engage in public service. These institutional costs influence, but are distinct from, published tuition prices and net costs paid by students and families. This chapter provides an overview of the most recent data and research related to expenditures and costs in higher education.

Abstract. A growing literature examining labor market returns to college major is motivated by large returns to skill. Prior research focuses on mean effects rather than earnings growth and variability. Using administrative data from Texas, we find that mean differences mask important features of the returns to college majors. First, earnings growth varies across fields. Second, there is considerable effect heterogeneity across workers. Third, major choice affects earnings variability within workers over time. We use our results to simulate a lifecyle utility model and compare mid-career utility and mean earnings returns across fields while highlighting the important role of risk preferences. 

Abstract. The extent to which pandemic-induced public school enrollment declines will persist is unclear. Student-level data from Michigan through fall 2021 yields three relevant findings. First, relative to pre-pandemic trends, fall 2021 enrollment had partially recovered for low-income, Black, and Hispanic students, but had declined further for non-low-income, White, and Asian students. Second, annual public school exit rates remained elevated for elementary students and accelerated further for middle school students. Third, public school exit is sticky and varies by chosen alternative. Only 21 percent of those who left for private schools in fall 2020 had returned by fall 2021, while 50 percent of those who left for homeschooling had returned. These findings suggest that pandemic-driven public school enrollment declines may persist, and more so among higher income families. 

Published paper. 

Abstract. We use the near universe of U.S. online job ads to document four new facts about the skills employers demand from college majors. First, some skills—social and organizational—are demanded from all majors whereas others—financial and customer service—are demanded from only particular majors. Second, some majors have skill demand profiles that mirror overall demand for college graduates, such as Business and General Engineering, while other majors, such as Nursing and Education, have relatively rare skill profiles. Third, cross-major differences in skill profiles explain considerable wage variation. Fourth, although major-specific skill demand varies across place, this variation plays little role in explaining wage variation. College majors can thus be reasonably conceptualized as portable bundles of skills.

Published paper. 

Abstract. This paper introduces a new measure of the labor markets served by colleges and universities across the United States. About 50% of recent college graduates are living and working in the metro area nearest the institution they attended, with this figure climbing to 67% in-state. The geographic dispersion of alumni is more than twice as great for highly selective 4-year institutions as for 2-year institutions. However, more than one quarter of 2-year institutions disperse alumni more diversely than the average public 4-year institution. In one application of these data, we find that the average strength of the labor market to which a college sends its graduates predicts college-specific intergenerational economic mobility. In a second application, we quantify the extent of “brain drain” across areas and illustrate the importance of considering migration patterns of college graduates when estimating the social return on public investment in higher education.

Published paper. 

Abstract. The Covid-19 pandemic drastically disrupted the functioning of U.S. public schools, potentially changing the relative appeal of alternatives such as homeschooling and private schools. We study changes in families’ choices of school sector using longitudinal student-level administrative data from Michigan and nationally representative data from the Census Household Pulse Survey. Public school enrollment declined noticeably in fall 2020, with 3 percent of Michigan students and 10 percent of kindergartners using other options. Most of this came from homeschooling rates jumping substantially among families with children in elementary school. Consistent with heterogeneous parental preferences for instructional mode, homeschooling increased more where schools provided in-person instruction while private schooling increased more where instruction was remote. Kindergarten declines were highest among low income and Black families while declines in other grades were highest among higher income and White families, highlighting important heterogeneity by students’ existing attachment to public schools. Our results shed light on how families make schooling decisions and imply potential longer-run disruptions to public schools in the form of decreased enrollment and changed composition of the student body.

Published paper. 

Abstract. This paper establishes five new facts about instructional costs in higher education using department-level data from a broad range of institutions. Costs vary widely across fields, ranging from electrical engineering (90% higher than English) to math (25% lower). This pattern is largely explained by differences in class size and faculty pay. Some STEM fields experienced steep declines in expenditures over the past 17 years, while others saw increases. Changes in class size and teaching loads alongside a shift toward contingent faculty explain these trends. Finally, the association between online instruction and instructional costs is statistically indistinguishable from zero.

Published paper. 

Abstract. Instructors are a chief input into the higher education production process, yet we know very little about their role in promoting student success. This is in contrast to elementary and secondary schooling, for which ample evidence suggests teacher quality is an important determinant of student achievement. Whether colleges could improve student and institutional performance by reallocating instructors or altering personnel policies hinges on the role of instructors in student success. In this paper we measure variation in postsecondary instructor effectiveness and estimate its relationship to overall and coursespecific teaching experience. We explore this issue in the context of the University of Phoenix, a large for-profit university that offers both online and in-person courses in a wide array of fields and degree programs.  We focus on instructors in the college algebra course that is required for all BA degree program students. We find substantial variation in student performance across instructors both in the current class and subsequent classes. Variation is larger for in-person classes, but is still substantial for online courses. Effectiveness grows modestly with course-specific teaching experience, but is unrelated to pay. Our results suggest that personnel policies for recruiting, developing, motivating, and retaining effective postsecondary instructors may be a key, yet underdeveloped, tool for improving institutional productivity.

Published chapter. 

Abstract. Vocational education is a large part of the high school curriculum, yet we have little understanding of what drives vocational enrollment or whether these courses help or harm early careers. To address this deficiency, we develop a framework for curriculum choice, taking into account ability and preferences for academic and vocational work. We test model predictions using detailed transcript and earnings information from the National Longitudinal Survey of Youth (1997). Our results are twofold. First, students positively sort into vocational courses, suggesting that the belief that low-ability students are funneled into vocational coursework is unlikely true. Second, we find higher earnings among students taking more upper-level vocational courses—a nearly 2 percent wage premium for each additional year, yet we find no gain from introductory vocational courses. These results suggest: (1) policies limiting students' ability to take vocational courses may not be welfare-enhancing, and (2) the benefits of vocational coursework accrue to those who focus on depth over breadth.

Published version. 

Abstract. We assess the importance of price regulation and price discrimination to low-income students' access to opportunities in public higher education. In 2003, Texas shifted tuition-setting authority away from the state legislature to public universities themselves. In response, most institutions raised sticker prices and many began charging more for high-earning majors, such as business and engineering. We find that poor students actually shifted toward higher earning programs following deregulation, relative to non-poor students. Deregulation facilitated more price discrimination through increased grant aid and enabled supply-side enhancements, which may have partially shielded poor students from higher sticker prices.

Published version. 

Abstract. Every term, institutions of higher education must make decisions about the class size for each class they offer, which can have implications for student outcomes, satisfaction, and cost. These decisions must be made within the current higher education landscape of tightening budgets and calls for increased productivity. Beyond institution decision making, prospective students and their families may use class size as one factor in deciding whether an institution might be a good fit for them. The current measure of class size found in university fact books, and subsequently sent to numerous ranking groups such as U.S. News & World Report (hereafter U.S. News), is an inadequate gauge of the student experience in the classroom, as measured by the percent of time students spend in classes of varying sizes. The current measure does not weight for enrollment, credits, or multiple components of a class, which results in a misleading representation of the student experience of class size. This paper will discuss these issues in depth, explain how class size varies across institutions, and offer recommendations on how to reweight class size in the Common Data Set to accurately describe it from the student’s perspective. Institutions could use this new metric to better understand class size, and subsequently to understand the student experience and cost of a class, while prospective students and their families could use the metric to gain a clearer picture of the class sizes they are likely to experience on campus.

Published version. 

Abstract. This paper investigates whether demand-side market pressure explains colleges’ decisions to provide consumption amenities to their students. Using a discrete choice model of college demand, we find that most students appear to value consumption amenities, such as operating spending on student activities, sports, and dormitories, while the taste for academic quality is confined to high-achieving students. Heterogeneity in student preferences creates variation in demand pressure across institutions, which we estimate can account for 11% of the total variation in the ratio of amenity to academic spending across 4-year colleges in the United States.

Published version. 

Abstract. Public investments in repairs, modernization, and construction of schools cost billions. However, little is known about the nature of school facility investments, whether it actually changes the physical condition of public schools, and the subsequent causal impacts on student achievement. We study the achievement effects of nearly 1400 capital campaigns initiated and financed by local school districts, comparing districts where school capital bonds were either narrowly approved or defeated by district voters. Overall, we find little evidence that these school capital campaigns improve student achievement. Event-study analysis focused on the students actually affected by large campus renovations also generates very precise zero estimates of achievement effects. Thus, U.S. school capital campaigns financed by local districts – the predominant method through which facility investments are made – may be a limited tool for realizing substantial gains in student achievement or closing achievement gaps.

Published version. 

Abstract. Students starting at a two-year college are much less likely to graduate than similar students who start at a four-year college, but the sources of this attainment gap are largely unexplained. This paper investigates the attainment consequences of sector choice and peer quality among recent high school graduates. Using data on all Preliminary SAT (PSAT) test-takers between 2004 and 2006, we develop a novel measure of peer ability for most two-year and four-year colleges in the United States—the average PSAT of enrolled students. We document substantial variation in this measure of peer quality across two-year colleges and nontrivial overlap between the two-year and four-year sectors. We find that half the gap in bachelor's degree attainment rates across sectors is explained by differences in peers, leaving room for structural barriers to transferring between institutions to also play an important role.

Published version. 

Abstract. This paper investigates changes in tuition policies in the wake of tuition deregulation in Texas, which in 2003 transferred tuition-setting authority from the state legislature to institutions. We find that price increases accelerated, particularly at the most selective institutions. Institutions also began differentiating price by undergraduate program, raising relative prices for the most costly and lucrative majors, including engineering, business, nursing, and architecture. Price increases were particularly large for institutions with the highest initial costs and for programs with a high earnings premium within institutions, though lower for institutions with more low-income students. These distinctions suggest that public postsecondary institutions respond to microeconomic incentives when given greater autonomy to set price, and take some measures to alleviate impacts on low-income students. The Texas experience suggests that decentralized price-setting generates greater price differentiation within the public higher education system, both across and within institutions.

Published version. 

Abstract. This paper examines the effect of marginal price on students’ educational investments using rich administrative data on students at Michigan public universities. Marginal price refers to the amount colleges charge for each additional credit taken in a semester. Institutions differ in how they price credits above the full-time minimum (of 12 credits), with many institutions reducing the marginal price of such credits to zero. We find that a zero marginal price induces a modest share of students (i.e., 7 percent) to attempt up to one additional class (i.e., three credits) but also increases withdrawals and lowers course performance. The analysis generally suggests minimal impacts on credits earned and the likelihood of meeting “on-time” benchmarks toward college completion, though estimates for these outcomes are less precise and more variable across specifications. Consistent with theory, the effect on attempted credits is largest among students who would otherwise locate at the full-time minimum, which includes lower-achieving and socioeconomically disadvantaged students.

Published version. 

Abstract. In the face of declining state support, many universities have introduced differential pricing by undergraduate program as an alternative to across-the-board tuition increases. This practice aligns price more closely with instructional costs and students’ ability to pay postgraduation. Exploiting the staggered adoption of these policies across universities, this paper finds that differential pricing does alter the share of students studying engineering and possibly business. There is some evidence that student groups already underrepresented in certain fields are particularly affected by the new pricing policies. Price does appear to be a policy lever through which state governments can alter the allocation of students to majors and thus the field composition of the workforce.

Published version. 

Abstract. Nurse practitioners (NPs) and physician assistants (PAs) now outnumber family practice doctors in the United States and are the principal providers of primary care to many communities. Recent growth of these professions has occurred amidst considerable cross-state variation in their regulation, with some states permitting autonomous practice and others mandating extensive physician oversight. I find that expanded NP and PA supply has had minimal impact on the office-based healthcare market overall, but utilization has been modestly more responsive to supply increases in states permitting greater autonomy. Results suggest the importance of laws impacting the division of labor, not just its quantity.

Published version. 

Abstract. This paper quantifies the option value arising from sequential schooling decisions made in the presence of uncertainty and learning about academic ability. College attendance has option value since enrolled students have the option, but not obligation, to continue in school after learning their aptitude and tastes. I estimate that option value accounts for 14 percent of the total value of the opportunity to attend college for the average high school graduate and is greatest for moderate-aptitude students. Students' ability to make decisions sequentially in response to new information increases welfare and also makes educational outcomes less polarized by background. (JEL D83, I23)

Published version. 

Abstract. This article examines the effect of institutional quality on the educational attainment of community college students, a large group that has been mostly overlooked in previous work. The effect of institutional quality is generally difficult to separate from that of student ability because more capable students usually sort into better colleges. A detailed analysis of student sorting reveals this not to be the case among community college students, for whom college quality is effectively determined by factors other than their aptitude. This facilitates identification of school quality effects. I find that community college quality (as measured by instructional expenditure per student and several other measures) has no impact on community college students' educational attainment. States and colleges should seek to identify other factors that may be more influential.

Published version. 

Abstract. This article quantifies the contribution of pre-treatment dynamic selection to the relationship between fertility timing and postsecondary attainment, after controlling for a rich set of predetermined characteristics. Eventual mothers and nonmothers are matched using their predicted birth hazard rate, which shares the desirable properties of a propensity score but in a multivalued treatment setting. I find that eventual mothers and matched nonmothers enter college at the same rate, but their educational paths diverge well before the former become pregnant. This pre-pregnancy divergence creates substantial differences in ultimate educational attainment that cannot possibly be due to the childbirth itself. Controls for predetermined characteristics and fixed effects do not address this form of dynamic selection bias. A dynamic model of the simultaneous childbirth-education sequencing decision is necessary to address it.

Published version. 

Abstract. Application inconvenience is one popular explanation for why many individuals do not receive the social benefits for which they are eligible. Applications take time and some individuals may decide that the financial benefits do not outweigh these time costs. This paper investigates this explanation using cross-state variation in administrative changes that made applying for unemployment insurance (UI) benefits substantially more convenient over the past decade. We find that the introduction of phone- and Internet-based claiming did not have an appreciable impact on overall UI take-up, nor did it lead to a shift toward recipients that are higher income or likely to be receiving the maximum benefit amount. These findings are inconsistent with a time- and transaction-cost explanation for low take-up, since remote UI claiming is less time intensive. This suggests that reducing application barriers alone may not be an effective tool for increasing program participation.

Published version.