Job Loss, Credit Card Loans, and the College-Persistence Decision of US Working Students. Working Papers. No. 23-19
Saved in:
| Title: | Job Loss, Credit Card Loans, and the College-Persistence Decision of US Working Students. Working Papers. No. 23-19 |
|---|---|
| Language: | English |
| Authors: | Pinghui Wu, Lucy McMillan, Federal Reserve Bank of Boston |
| Source: | Federal Reserve Bank of Boston. 2023. |
| Availability: | Federal Reserve Bank of Boston. P.O. Box 55882, Boston, MA 02205. Tel: 617-973-3000; Tel: 617-973-3397; e-mail: boston.library@bos.frb.org; Web site: https://www.bostonfed.org/ |
| Peer Reviewed: | N |
| Page Count: | 59 |
| Publication Date: | 2023 |
| Document Type: | Reports - Research |
| Education Level: | Higher Education Postsecondary Education High Schools Secondary Education |
| Descriptors: | Undergraduate Students, College Enrollment, Paying for College, College Bound Students, Student Employment, Credit (Finance), Unemployment, Job Layoff, Academic Persistence, Dropouts, Causal Models |
| Abstract: | This study assesses the impact of involuntary job loss on college persistence by leveraging different job-loss timings relative to a student's college enrollment decision. We find that job loss increases the probability that a working college student leaves college before attaining a degree, but access to short-term credit through credit card loans buffers this liquidity effect. By restricting credit supply to college students, the CARD Act of 2009 has inadvertently inhibited the ability of liquidity-constrained students to remain in college when their earnings unexpectedly fall, resulting in a stronger liquidity effect of job loss on college persistence over the last decade. |
| Abstractor: | As Provided |
| Entry Date: | 2024 |
| Accession Number: | ED660709 |
| Database: | ERIC |
| Abstract: | This study assesses the impact of involuntary job loss on college persistence by leveraging different job-loss timings relative to a student's college enrollment decision. We find that job loss increases the probability that a working college student leaves college before attaining a degree, but access to short-term credit through credit card loans buffers this liquidity effect. By restricting credit supply to college students, the CARD Act of 2009 has inadvertently inhibited the ability of liquidity-constrained students to remain in college when their earnings unexpectedly fall, resulting in a stronger liquidity effect of job loss on college persistence over the last decade. |
|---|
