Student debt and enrollment in graduate and professional school

A theoretical and empirical analysis of the impact of undergraduate debt on the propensity to enroll in graduate and professional school is presented. The theoretical model does not unambiguously predict that undergraduate debt deters additional schooling. Indeed, the reverse may be true. The econometric work uses a sample of approximately 12000 recent college graduates. A key finding is that among women, undergraduate debt deters enrollment in graduate and professional school. However, the effect is quite small. The empirical results also imply that undergraduate debt leads to a shift in enrollment towards doctoral study and away from other forms of post baccalaureate training.