ERIC ED562945: The Impact of Tuition Increases on Undocumented College Students' Schooling Decisions

Abstract Title Page

Title: The Impact of Tuition Increases on Undocumented College Students’ Schooling Decisions

Authors and Affiliations:

Dylan Conger

The George Washington University

Trachtenberg School of Public Policy and Public Administration

805 21st Street NW, MPA 60 1G

Washington, DC 20052

202-994-1456

dconger@gwu.edu

This paper examines the effect of a short-lived increase in tuition rates on undocumented college
students’ schooling decisions. In the spring of 2002, the City University of New York (CUNY)
reversed its policy of charging in-state tuition rates to undocumented college students who could
demonstrate that they migrated to New York at a relatively young age. The policy was in place
for exactly one semester; by fall 2002, the New York legislature restored the in-state tuition
policy for eligible undocumented youth. I use this unique policy context to examine the impact
of tuition increases on undocumented students’ schooling choices, including whether to remain
enrolled or to disenroll for a semester (“stopout”) and whether to enroll part-time instead of full-
time. The data are provided by CUNY and the empirical models estimate the difference between
documented and undocumented students in fall 2002 relative to earlier and later semesters. The
results suggest that the removal of in-state tuition caused undocumented students in the
bachelor’s degree programs to stopout of school and shift from full-time to part-time enrollment.
The findings provide strong evidence that college costs can have a large impact on the collegiate
outcomes of undocumented students who have already chosen to attend college and, perhaps
more generally, the outcomes of price sensitive college students, including those from low-
income backgrounds.

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Abstract Body

Background / Context:

Undocumented college students lie at the intersection of two major policy debates in the United
States: how to refonn the immigration system and what to do about the growing cost of obtaining
a college diploma. In June of 2012, the Obama administration announced the Deferred Action
for Childhood Arrivals program, which shields eligible undocumented immigrant youth from
deportation and provides them with temporary work authorization. An estimated 1.7 million
undocumented youth who migrated to the U.S. with their parents before they were 16 years old
are considered eligible for the Deferred Action program (Passel and Lopez 2012). Congress is
also considering immigration refonn once again, with some proposals including elements of the
previously-rejected Development, Relief and Education for Alien Minors (DREAM) Act. The
DREAM-like proposals would not only prevent deportation but also provide eligible youth with
a pathway to pennanent residency status and access to federal benefits, such as aid for college.

In the meantime, over a dozen states have passed legislation to extend in-state tuition benefits to
eligible undocumented college students and some state governments have debated state-level
DREAM Acts, which would grant students’ access to other public and private sources of college
aid. The in-state tuition subsidy represents a nontrivial share of the current estimate of obtaining
a four-year degree at a public institution; at most public four-year institutions, the out-of-state
cost is more than twice the in-state cost (Hemelt and Marcotte, 2011).

A consensus is emerging on the substantial impact of tuition subsidies on the post-secondary
schooling decisions of the nation’s youth. A recent review by Deming and Dynarski (2010)
points to significant increases in college-going among students whose sticker price dropped due
to exogenous sources of aid, such as the introduction of a state merit-based aid program. And
two of the three prior studies on the effect of state-level policies that provide in-state tuition
benefits to eligible undocumented students find positive effects on Mexican students’ college-
going (Kaushal, 2009; Flores, 2010), while a third study finds positive estimates only for older
Mexican males (Chin and Juhn, 2011).

There are two areas that remain relatively under-explored. The first is the degree to which
tuition shocks impact the schooling decisions of inframarginal students — that is, students who
have already made the decision to enroll in college and are no longer on the enrollment margin.
Little is known, for example, about the effect of tuition changes on inframarginal students’
choices to take a leave from school (sometimes referred to as “stopping out”) or to attend school
part-time as opposed to full-time. Exceptions include work by Angrist et al. (2011); Bettinger
(2004); DesJardins et al. (2002); and Dynarksi (2008). The second concerns how tuition shocks
affect the decisions of inframarginal students who are undocumented. Undocumented students
represent a somewhat unusual subset of the college student population given the many barriers
they face to normal young adult pursuits; chief among these barriers is a severely restricted labor
market. Undocumented college students are also disproportionately from low-income families,
first generation college students, and minorities, and likely more price sensitive than the average
college student (Gonzales 2011; Perez 2009). To my knowledge, there are no studies on the
effect of college costs on the schooling decisions of undocumented college students.

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Purpose / Objective / Research Question / Focus of Study:

This paper directly informs these under-researched topics by identifying the impact of a tuition
increase at a major urban university system on the enrollment decisions of inframarginal
undocumented college students. For only one semester, the City University of New York
(CUNY) reversed its long-standing policy of charging in-state tuition rates to undocumented
youth who graduated from a New York high school. This one-semester tuition increase for
undocumented students offers a natural experiment for examining the effect of tuition on
undocumented students' enrollment choices, including their decision to remain enrolled (or
stopout) and their choice of full- or part-time enrollment. Correspondingly, the estimation
strategy compares the difference between undocumented and documented students college
choices in the tuition shock semester to the differences between these two groups in choices
made in proximate semesters.

Setting:

The data for this study are obtained from CUNY, which educates more than 480,000 students in
over 20 public colleges and institutions in New York City.

Population / Participants / Subjects:

The analytic sample consists of students who entered a bachelors degree program at one of the
CUNY colleges between Fall 1999 and Spring 2001 (N=52,694). These students are then
observed for the five semesters that encompass the tuition shock, including Spring 2001 through
Spring 2003 (with Spring 2002 at the center of the panel). The data contain information on
students’ schooling choices and outcomes in each semester, including whether they choose to
enroll and the number of courses they pursue conditional on enrollment. Of key interest, the data
also record students’ citizenship or immigration status in the US for the purpose of tuition
determination. Upon enrollment, students are asked to identify themselves as one of the
following: US citizen, permanent resident, student visa holder, temporary visa holder, asylum or
refugee, or expired visa holder, or undocumented. Students who report that they are US citizens
are required to submit documentation and those who either report that they are undocumented or
who fail to provide valid documentation (e.g., current or expired visa, temporary authorizations
to live and work in the US) are recorded as undocumented.

Intervention / Program / Practice:

In the Fall of 2001, shortly after the terrorist attacks of 9/1 1, officials at CUNY announced that
they would be charging out-of-state tuition rates to all immigrant students. This policy reversed
the university's previous practice of charging in-state rates to undocumented immigrant students
who could demonstrate that they lived in New York or attended a New York State high school
for at least one year prior to enrollment. The new policy was in place for exactly one semester
(spring of 2002) and was subsequently overturned by the New York State legislature, which
passed a law in the summer of 2002 that reinstated in-state tuition benefits for eligible
undocumented students. In the spring of 2002, the tuition rates for previously-eligible
undocumented students at 4-year colleges more than doubled (from $133 to $283 per credit).

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With a full-course load of 12 credits, this represented a tuition increase of $ 1 800 in the spring of

2002 .

Research Design:

The estimation approach compares the difference between undocumented and documented
students enrollment choices in the tuition shock semester to the differences between these two
groups in choices made in proximate semesters. The basic model is as follows:

(1) Ytt = To + /iS(t) + y 2 S(t) x U it + y 3 A) + e it

where Y it is one of several schooling choices for student i in semester t; the vector S(t) contains
fixed effects for each of the five semesters observed; t/; is set to one if the student is
undocumented (where all documented immigrants as well as US citizens comprise the reference
group); Xi is a vector of covariates, which includes time invariant pre-collegiate attributes (e.g.,
race/ethnicity, gender), major, and college fixed effects; and e it is a random error component.
The primary estimates of interest are found in f 2 , which provide the difference between
documented and undocumented students in the schooling outcomes in each semester. The policy
change occurred in the middle of the five semesters observed and the treatment effect if
detennined by comparing the estimate in that semester to the estimates in proximate semesters.
The results are also tested for sensitivity to the choice of comparison group (e.g., only in-state
tuition eligible documented students), method for addressing correlated error terms, estimation
strategy (OLS versus Probit), sample selection due to within-panel graduation, as well as
heterogeneity in effects (e.g., by race, gender, and institution).

Data Collection and Analysis:

All administrative data have been obtained from the CUNY system.

Findings / Results:

Preliminary results, which are partially illustrated in the attached figures, reveal a large decrease
in the enrollment (overall enrollment and full-time enrollment) of undocumented students in the
bachelor’s degree program as a result of the tuition increase. Figure 1, for example, shows the
raw enrollment rates of students in the bachelor’s degree programs by their immigration status
(documented versus undocumented) and semester. The dashed line shows the enrollment rate
among documented students and the solid line shows the enrollment rate among undocumented
students, with the vertical line marking the spring of 2002, when the tuition rates doubled for
undocumented students. (As a reminder, the sample includes students who had enrolled in a
previous semester and who had not yet graduated from the system; thus, those who are not
enrolled in any given semester are either stopouts or dropouts). Figure 1 shows that
undocumented students are enrolled at higher rates than their documented peers in all semesters
except spring 2002, when their enrollment drops. Regression-adjusted estimates suggest that
undocumented students are 4 percentage-points more likely to be enrolled than observationally-
equivalent documented students in fall 2001 and fall 2002, and approximately 2 percentage
points less likely to be enrolled in spring 2002 (not shown in Figure). Interestingly, though the

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increase in tuition induced students to stopout, the return of the subsidy in the next semester,
induced them back into school, indicating that the short-term tuition shock did not cause students
to permanently drop out of school. Similar findings are observed for full- versus part-time
enrollment, with undocumented students showing marked decreases in full-time enrollment in
the semester in which their costs increased (see Figure 2).

Conclusions:

Over 40 percent of students who enroll in a four-year college fail to obtain their degrees within
six years and the rates are even higher for students from low-income families (Radford et ah,
2010). This paper provides evidence that the tuition supports provided to undocumented students
during their college careers significantly increase their retention and increase their likelihood of
taking a full courseload. Thus, even if tuition subsidies (and, correspondingly, federal and state
grants) have no impact on undocumented students’ college enrollment, such supports can impact
the time that it takes students to obtain their degrees.

A key remaining question is the extent to which undocumented students benefit from their
college degrees. Research on immigrant students generally often finds that they are a positively-
selected group who often outperform native-born students from similar socio-demographic
profiles (e.g, Kao and Tienda 1995; Schwartz and Stiefel 2006). Consistent with this observation,
a policy brief by Conger and Chellman (2013) finds that undocumented students in the CUNY
system tend to resemble other immigrant groups (namely permanent residents and visa holders)
on academics, all of whom earn higher GPAs and accumulate more credits than US citizens.
Based on these accounts, it is possible that undocumented youth represent a relatively high
ability group, such that the returns to a college degree could be large if barriers to employment
were removed. Again, this question deserves further inquiry in order to fully evaluate the net
benefits of reforms aimed at increasing the college-going and completion rates of undocumented
youth.

The natural experiment examined in this study, combined with the unique data that tracks
immigration status, provides for a relatively strong causal design. At the same time, the extent to
which these results can be generalized beyond New York City, a city with a longstanding history
of immigration, a diverse immigrant population, and an immigrant-supportive climate, is a
question that should be further explored with applications in other areas.

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Appendices

Appendix A. References

Angrist, Joshua, Daniel Lang, and Philip Oreopoulos. (2009). “Incentives and Services for College
Achievement: Evidence from a Randomized Trial.” American Economic Journal: Applied Economics 1:1,
136-163.

Bettinger, Eric. (2004). “How Financial Aid Affects Persistence.” Chapter 6 in College Choices: the
Economics of Where to Go, When to Go, and How to Pay for It. Caroline M. Hoxby (editor). University
of Chicago Press.

Chin, Aimee and Juhn, Chinhui. (2011). “Does Reducing College Costs Improve Educational Outcomes
for Undocumented Immigrants? Evidence from State Laws Permitting Undocumented Immigrants to Pay
In-State tuition at State Colleges and Universities.” Chapter 4 (pages 63-94) in Latinos and the Economy:
Integration and Impact in Schools, Labor Markets, and Beyond. David L. Leal, and Stephen J. Trejo
(editors). Springer Press.

Conger, Dylan and Colin Chellman (2013). “Undocumented College Students in the United States: In-
State Tuition Not Enough to Ensure Four-Year Degree Completion.” Education Finance and Policy 8(3),
364-377, 2013.

Deming, David and Susan Dynarski. (2010). “Into College, Out of Poverty? Policies to Increase the
Postsecondary Attainment of the Poor,” in Phil Levine and David Zimmerman, eds. Targeting
Investments in Children: Fighting Poverty When Resources are Limited.

DesJardins, S.L., D.A. Ahlburg, and B.P. McCall. (2002). “Simulating the Longitudinal Effects of
Changes in Financial Aid on Student Departure from College.” The Journal of Human Resources 37(3):
653-679.

Dynarksi, Susan. (2008). “Building the Stock of College-Educated Labor.” Journal of Human Resources
43(3): 576-610.

Flores, Stella M. (2010). "State Dream Acts The Effect of In-State Resident Tuition Policies and
Undocumented Latino Students." The Review of Higher Education 33(2), 239-283.

Gonzales, Roberto G. (2011). “Learning to be Illegal: Undocumented Youth and Shifting Legal Contexts
in the Transition to Adulthood.” American Sociological Review 76(4): 602-619.

Hemelt, Steven W. and David E. Marcotte. (2011). “The Impact of Tuition Increases on Enrollment at
Public Colleges and Universities.” Educational Evaluation and Policy Analysis 33(4): 435-457.

Kao, Grace, and Tienda, Marta. (1995). "Optimism and Achievement: The Educational Performance of
Immigrant Youth." Social Science Quarterly 76(1), 1-19.

Kaushal, Neeraj. (2008). "In-state Tuition for the Undocumented: Education Effects on Mexican Young
Adults." Journal of Policy Analysis and Management 27(4), 771-792.

Passed, Jeffrey S. and Mark Hugo Lopez. (2012). Up to 1.7 Million Unauthorized Immigrant Youth May
Benefit from New Deportation Rules. Pew Hispanic Center.

B-l

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Perez, William. (2009). We ARE Americans: Untold Stories of Undocumented Students in Pursuit of the
American Dream. Stylus Publishing: Sterling, VA.

Radford, A.W., Berkner, L., Wheeless, S.C., and Shepherd, B. (2010. Persistence and Attainment of
2003-04 Beginning Postsecondary Students: After 6 Years (NCES 2011-151). U.S. Department of
Education. Washington, DC: National Center for Education Statistics.

Schwartz, Amy Ellen, and Stiefel, Leanna. (2006). “Is There a Nativity Gap? Achievement of New York
City Elementary and Middle School Immigrant Students.” Education Finance and Policy 1, 17-49.

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Appendix B. Tables and Figures

Figure 1 : Enrollment by Semester and Immigrant Status, Bachelors Degree Students

Figure 2: Full-time Enrollment by Semester and Immigrant Status, Bachelors Degree
Students

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