The impact of bank loans on university student retention
International Journal of Educational Management
ISSN: 0951-354X
Article publication date: 26 April 2024
Abstract
Purpose
This study analyzed the impact on the persistence of Chilean university students who had received a government-guaranteed loan (CAE).
Design/methodology/approach
Using academic and administrative data from 2016 to 2019, provided by 11 Chilean universities, a discrete-time survival model was constructed. The model was based on data of 5,276 students in the 2016 cohort and included sociodemographic variables, academic background prior to entering university and academic performance once in university. As a robustness check of our results to observable confounding, the analysis was repeated using a control group constructed using propensity score matching (PSM).
Findings
The results reveal that students who receive a bank loan (CAE) were more likely to remain in undergraduate studies for at least the first two years of university, as opposed to their peers who did not receive financial aid. In addition, they show the importance of academic performance in retention.
Originality/value
The article advances in the identification of the impact of bank loans on permanence. Although previous research has evaluated the impact of the CAE, it has been conducted on small samples of students. These studies also lacked student records associated with their academic performance at the university. The present research overcomes both weaknesses, allowing us to estimate the impact of the CAE on a larger population of students that is representative of the system.
Keywords
Acknowledgements
The authors are grateful for the data provided by the universities participating in the research. The authors also appreciate the support given by the Instituto Interuniversitario de Investigacion Educativa (IESED-Chile).
Citation
Espinoza, O., Gonzalez, L., Sandoval, L., Corradi, B., Larrondo, Y. and McGinn, N. (2024), "The impact of bank loans on university student retention", International Journal of Educational Management, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/IJEM-06-2023-0285
Publisher
:Emerald Publishing Limited
Copyright © 2024, Emerald Publishing Limited