The Determinants of College Matriculation in the United States

This dissertation measures the extent to which changes in student loan interest rates and information asymmetries affect the matriculation decisions of college students in the United States. The third chapter modifies a two-period human capital investment model and shows that increases in both student loan interest rate subsidies and information interventions can increase human capital investment. However, interest rate subsidies have the undesired effects of causing low-ability students to overinvest, while also subsidizing college choice for students who can otherwise afford college. In the case of students who are bound by student loan borrowing constraints, increases in student loan interest rate subsidies only work by pushing students who are sufficiently risk tolerant toward more expensive consumer loans. Alternatively, information interventions designed to provide students with correct information about their abilities and the future payoff of a postsecondary education will increase human capital investment only among students who invest below the socially-optimal level.The fourth chapter uses longitudinal survey data to measure the effect of student loan interest rates on college matriculation. Relying on exogenous variation in real student loan interest rates across high school graduation cohorts to identify this effect, I find no statistically significant effect of student loan interest rates on the decision to matriculate immediately to a four-year institution. The fifth chapter uses administrative microdata from an Ohio-based college access program to measure the effects of reducing information asymmetries on college matriculation. Overall, the program increases the probability of matriculating within nine months of high school by 32.9 percentage points. Financial aid counseling and admissions advising have the most significant effects, increasing matriculation by 5.1 and 1.5 percentage points, respectively. These effects are significantly stronger for low-ability students and those from lower-income neighborhoods.