Working paper

High School Track Choice and Financial Constraints:Evidence from Urban Mexico

Ciro Avitabile, Matteo Bobba, and Marco Pariguana

Abstract

We study how a large household windfall affects sorting of relatively disadvantaged youth over high school tracks by exploiting the discontinuity in the assignment of a welfare program in Mexico. The in-cash transfer is found to significantly increase the probability of selecting vocational schools as the most preferred options vis-a-vis other more academically oriented education modalities. We find support for the hypothe- sis that the receipt of unearned income allows some students to choose a schooling career with higher out-of-pocket expenditures and higher expected returns. The ob- served change in stated preferences across tracks effectively alters school placement, and bears a positive effect on later education outcomes.

Keywords

school choice; tracking; financial constraints; vocational education; returns to education; regression discontinuity design;

JEL codes

  • D83: Search • Learning • Information and Knowledge • Communication • Belief
  • I21: Analysis of Education
  • I24: Education and Inequality
  • J24: Human Capital • Skills • Occupational Choice • Labor Productivity

Reference

Ciro Avitabile, Matteo Bobba, and Marco Pariguana, High School Track Choice and Financial Constraints:Evidence from Urban Mexico, TSE Working Paper, n. 16-661, June 2016, revised May 2017.

See also

Published in

TSE Working Paper, n. 16-661, June 2016, revised May 2017