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CSMGEP Dissertation Session

Paper Session

Friday, Jan. 7, 2022 10:00 AM - 12:00 PM (EST)

Hosted By: American Economic Association & Committee on the Status of Minority Groups in the Economics Profession
  • Chair: Kalena Cortes, Texas A&M University

Student Housing, Gentrification and Affordability: The Case of Urban Universities in the United States

Haydar Kurban
,
Howard University
Deniz Baglan
,
Howard University
Kirsten McLeod
,
Howard University

Abstract

Constraints to on-campus university student housing abound amid marked growth in student enrollment across the US over the past few decades (Ong et al, 2013). This tendency has been exacerbated by limited land capacity, strict zoning regulations and privatization of university housing. Meanwhile, there has been considerable gentrification of low-income neighborhoods in several US urban areas where college graduates are seen as important players of this process (McKinnish et al 2010). This paper seeks to determine the impact of changes in student housing patterns on local housing markets and how these changes have contributed to affordability around gentrified university neighborhoods in major metropolitan areas. We merge data including the Integrated Postsecondary Education Data system (IPEDS) from the National Center for Education Statistics and the American Community survey (ACS) data sourced from the US Census Bureau, over the period 2010 to 2019. In this context, we examine the relationship between student housing and affordability in neighborhoods around US universities. This data set allows us to explore school characteristics, affordability and neighborhood characteristics at a granular level. Specifically, we utilize panel regressions to study how changes in student housing affect affordability in gentrified neighborhoods. Our key findings are that gentrification of neighborhoods surrounding universities with dormitory capacity leads to improved affordability outcomes, particularly for higher-income in-migrants. Furthermore, our analysis suggests that minority students could be contributing to gentrification while lower income minority residents bear the cost of gentrification by being displaced from their neighborhoods.

Redesigning Federal Student Aid in Higher Education

Luis Armona
,
Stanford University
Shengmao Cao
,
Stanford University

Abstract

In this paper, we estimate a structural model of supply and demand for non-selective, sub-baccalaureate colleges in the United States, which consists of public community colleges and private for-profit colleges. We use these estimates to consider alternative federal student aid policies, with the goal of improving the overall quality of education provided to students in higher education. We show that the current federal aid system, which ties aid to the costs of attending colleges, distorts the incentives of private for-profit colleges, and leads to higher tuition prices paid by students. We then derive an optimal policy for a social planner who wishes to maximize educational quality, as measured by the value-added of each institution of low-income students, the primary beneficiaries of student aid. Counterfactual results show that switching from the existing federal aid regime to the optimal voucher system improves the overall quality provided to low-income students by 19%. In contrast, implementing bans on low-quality colleges, while maintaining the current aid design, leads to an increase in total value-added of 1.5%. Our optimal voucher policy highlights that for-profit colleges are more responsive to government aid than constrained community colleges, and correspondingly are an important tool for regulators to improve the educational outcomes of students.

Does the Market Value School Social Climate? Evidence from Chicago Housing Transactions and a School Climate Information Campaign

Rene Crespin
,
Cornell University

Abstract

An increasing number of states, school districts, colleges, and universities have begun to focus on the social, learning, and working conditions experienced by students, families, and teachers as a component for school improvement—making this one of the biggest current issues in education policy. Although a growing number of educational institutions seem to value their institutional climate, causal research on how much stakeholders value this is limited. In this paper, I study how an initial public release of school climate ratings in Chicago, Illinois affected families’ willingness to pay for homes zoned to better-climate schools. I use two natural experiments in a difference-in-differences framework and in a regression discontinuity design to isolate the causal effects. I find that the information campaign leads to house price increases of about 2%-6%, but these decline as the salience of the information dissipates. Furthermore, I discuss the heterogeneity of effects by race/ethnicity, income, and neighborhood/school characteristics, as well as the potential mechanisms of my findings. This research has strong implications on families’ school choice and residential decisions, which can impact property values and districts’ tax bases.

Credit Constraints, Beliefs and Inequality in Higher Education

Sergio Barrera
,
University of Minnesota

Abstract

In this paper I explore the effects of guaranteeing free tuition on inequality by parental education and racial and ethnic background in college enrollment and attainment of a bachelor's degree in the presence of incomplete information and differences in financial support. To do this I formulate and then estimate the parameters of an economic model where adolescents are uncertain about latent ability types and learn about this type through grades. In support of the key mechanism of the model, I show that in the NLSY97 that parental education and race and ethnicity are strongly correlated with beliefs about bachelor's degree attainment and enrollment in college. I will test whether this is linked to neighborhood information. Furthermore, I find that these beliefs are positively predictive of college enrollment and along with grades of bachelor's degree attainment. Using the estimated parameters, I find that free tuition is not the most effective policy for increasing diversity by race ethnicity and parental background. Instead, a policy targeted to groups of interest along with information revelation are more effective at closing gaps in higher education backgrounds.
Discussant(s)
Michael F. Lovenheim
,
Cornell University
Lesley J. Turner
,
Vanderbilt University
Joshua Goodman
,
Boston University
Susan Dynarski
,
Harvard University
JEL Classifications
  • I0 - General