Department or Administrative Unit

Economics

Document Type

Article

Creative Commons License

Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Author Copyright

© The Author(s) 2023.

Publication Date

8-6-2023

Journal

The American Economist

Abstract

Amid rising concerns regarding student loan debt, we examine the effect of Washington State’s College Affordability Program introduced in 2015 on undergraduate student loan debt to provide policy-makers with additional tools to help prevent another student loan debt crisis. The program reduced tuition for resident full-time undergraduate students at public colleges and universities for two consecutive academic years. This policy adoption created a natural experiment that we exploit to identify a causal link between tuition and loans. Using college-level data for the 2009–2010 through 2021–2022 academic years and employing a difference-in-differences model in conjunction with nearest-neighbor matching, we show that a decrease in college tuition following the adoption of the College Affordability Program caused a $637.96 (9 percentage-point) decline in average loans among first-time, full-time undergraduates in Washington State relative to undergraduates from matched U.S. schools.

Comments

This article was originally published in The American Economist. The full-text article from the publisher can be found online.

Due to copyright restrictions, the article available for download from ScholarWorks @ CWU is the pre-publication version. Reuse is restricted to non-commercial and no derivative uses.

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