Essays on housing, education, and inequality

Abstract

According to standard economic theory, more people will obtain postsecondary education in response to the rising college wage premium. However, students from low income families remain less likely to earn a college degree than high income students, even controlling for academic preparation. My dissertation provides empirical evidence on the puzzle of low college attainment among low income students. First, I estimate the effects of motivational qualities on college graduation by performing multivariate regression analysis using National Education Longitudinal Study data. I find that motivational qualities measured in 8th grade, i.e. causally prior to postsecondary participation, predict college degree completion, independent of grades and demographic characteristics. Further, the positive impact is concentrated among disadvantaged students. Second, I examine if students possess adequate information about college preparation and the application process by conducting observations and over 50 interviews with high school guidance counselors, advisors, and students in public schools serving poor neighborhoods. I find that students are familiar with college applications but they are unaware of their own academic performance and lack context to make effective use of college guidance. Third, I identify the causal effect of college selectivity on degree completion by using National Longitudinal Survey of Youth data and instrumental variable estimation. I find that attendance at selective public universities increases the probability of graduation, controlling for grades and family background. This dissertation contributes to the literature by identifying the role of motivational qualities on college outcomes, increasing our understanding of student information about college, and assessing the impact of college quality on degree completion. The results have important public policy implications: 1) colleges can both improve graduation rates and increase student diversity by attaching more weight to motivation qualities in the admissions process, 2) schools must instill strong academic habits earlier so students can obtain higher grades and benefit from college guidance, and 3) students should enroll in the most selective colleges they are qualified to attend. Understanding the barriers to higher education for low income students is essential for increasing the proportion of college graduates and improving individual socioeconomic mobility, urban revitalization, and national economic competitiveness.