Abstract: Using administrative data from Chile, we analyze whether financing higher education through student loans or grants affects college major choices of prospective university students. We exploit institutional arrangements that allocate either type of financing based on a standardized test to locally identify exogenous variation in access. Students that are marginally eligible for grants are more likely to enroll in STEM related fields. Relying on information from past graduates on narrowly defined college programs, we provide evidence that this effect is more generally driven by grants acting as insurance mechanism against uncertainty about degree completion.

Abstract: This paper examines the effects of a recruitment policy implemented in Chile aimed at improving the future quality of teachers. The reform used scholarships to incentivize the enrollment of high-achieving high school graduates into pedagogy programs, while also restricting access to these programs for low-achieving high school graduates.  Using rich administrative data and exploiting quasi-random variation around the definitions of low and high achievement, which are based on cut-offs in a standardized college entrance exam, we document that the reform was effective in changing the composition of high school graduates who enrolled in education programs and later entered the teaching profession. We follow these new teachers into their teaching careers and construct teacher value-added (TVA) measures to assess the impact of the reform on teacher quality. We document that the reform led to an increase in the TVA of mathematics teachers, equivalent to 30\% of their standard deviation, but had no effect on the average TVA of Spanish teachers. We provide evidence that these heterogeneous effects are due to the different predictive power of college entrance exams on value-added across subjects. Finally, we provide evidence that the reform did not induce adverse selection among high scorers, and that it may have induced positive selection among those low scorers who chose to enroll despite the restriction.  

Abstract: We investigate whether the decision of young adults on when to leave the parental home is influenced by the number of siblings they have, in the context of European countries over the last seventy years. Using data from two large surveys and exploiting random variation in sibship size induced by twin births, we identify the causal effect of having an extra sibling on the timing of home-leaving. We find that one additional sibling speeds up the transition to independent living by roughly six months. We provide evidence that our results directly stem from a decrease in the value of intergenerational coresidence implied by having an extra sibling.