Working Paper: NBER ID: w22679
Authors: George Bulman; Robert Fairlie; Sarena Goodman; Adam Isen
Abstract: We examine U.S. children whose parents won the lottery to trace out the effect of financial resources on college attendance. The analysis leverages federal tax and financial aid records and substantial variation in win size and timing. While per-dollar effects are modest, the relationship is weakly concave, with a high upper bound for amounts greatly exceeding college costs. Effects are smaller among low-SES households, not sensitive to how early in adolescence the shock occurs, and not moderated by financial aid crowd-out. The results imply that households derive consumption value from college and household financial constraints alone do not inhibit attendance.
Keywords: college attendance; lottery wins; financial resources
JEL Codes: I23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Parental lottery wins (H27) | Children's college attendance (I21) |
| Parental lottery wins of $1,000,000 or more (H27) | Children's college attendance (I21) |
| Household financial resources (G59) | Children's college attendance (I21) |
| Parental lottery wins (H27) | Need-based financial assistance (I22) |
| Need-based financial assistance (I22) | Children's college attendance (I21) |
| Timing of financial shock (E44) | Children's college attendance (I21) |