Working Papers

Financial Aid and College Pricing: Estimates from the PLUS Program (with William Mann)
Abstract: We study how financial aid affects college pricing. Our empirical setting is a tightening of credit standards that occurred in the PLUS student loan program in 2011. In response, enrollment, revenues, and expenditures all fell at private colleges with many low-income students. We exploit this demand shock to estimate the marginal costs charged to the students at the margin of qualifying for PLUS loans. We find that marginal costs were less than half of tuition and fees at the median, implying that colleges charged large markups to these students. Markups were higher at for-profit schools, and in states with fewer public schools. Our results complement prior evidence on the Bennett Hypothesis in higher education, and contrast prior studies that estimate small markups at private colleges. To the extent that our results reflect large fixed costs in higher education, we argue that subsidies should ideally target those fixed costs.

Work in Progress

The Role of Banks vs. Broker-Dealers in Asset Prices

Predictive Regressions: A Pricing-Kernel Approach (with Mikhail Chernov)

Intermediary Asset Pricing: Size Matters (with Andrea Eisfeldt and Tyler Muir)