Federal Reserve Board of Governors
20th & Constitution Ave., NW
Washington, DC 20551
Institutional Affiliation: Federal Reserve Board
NBER Working Papers and Publications
|September 2016||Parental Resources and College Attendance: Evidence from Lottery Wins|
with George Bulman, Robert Fairlie, Adam Isen: w22679
We examine more than one million children whose parents won a state lottery to trace out the effect of financial resources on college attendance. The analysis links the universe of federal tax records to federal financial aid records and leverages substantial variation in the size and timing of lottery wins. The results reveal that, while the per-dollar effect is modest (i.e., about 0.6 percentage point for every $100,000 of winnings), the relationship between win size and attendance is only weakly concave, with a high upper bound for amounts that greatly exceed the cost of college. The effects are smaller among lower-SES households, are not sensitive to how early in adolescence the resource shock occurs, and persist through each of the four years after high school. Finally, while addition...