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COLLEGE COST AND TIME TO COMPLETE A DEGREE: EVIDENCE FROM TUITION DISCONTINUITIES

Pietro Garibaldi, Francesco Giavazzi, Andrea Ichino and Enrico Rettore
The Review of Economics and Statistics
Vol. 94, No. 3 (August 2012), pp. 699-711
Published by: The MIT Press
Stable URL: http://www.jstor.org/stable/23261473
Page Count: 13
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COLLEGE COST AND TIME TO COMPLETE A DEGREE: EVIDENCE FROM TUITION DISCONTINUITIES
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Abstract

University tuition typically remains constant throughout the years of enrollment while delayed degree completion is increasingly a problem for academic institutions around the world. Theory suggests that if continuation tuition were raised, the probability of late graduation would be reduced. Using a regression discontinuity design on data from Bocconi University in Italy, we show that a 1,000 euro increase in continuation tuition reduces the probability of late graduation by 5.2% when the benchmark probability is 80%. This decline is not associated with an increase in the dropout rate or a fall in the quality of students performance.

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