Student Selectivity and Higher Education Institutions Credit Ratings

Journal of Financial Economic Policy, Forthcoming

39 Pages Posted: 3 Oct 2019 Last revised: 14 Nov 2020

See all articles by Aron A. Gottesman

Aron A. Gottesman

Pace University - Lubin School of Business - Department of Finance and Economics

Iuliana Ismailescu

Pace University - Lubin School of Business

Date Written: February 17, 2020

Abstract

This paper investigates the relation between the creditworthiness of U.S. institutions of higher education and their student selectivity (i.e., demand and quality). We study whether the impact of student selectivity differs across public versus private universities; across the credit quality of the given public university’s state; and across the level of state appropriations for the given public university. We find that student quality and demand measures are significantly associated with their corresponding institution’s creditworthiness, especially for private universities. For public universities the association is weak and, contrary to our expectations, does not depend on the state credit quality or level of state funding. Our findings are robust to the inclusion of control variables.

Keywords: credit ratings, student selectivity, higher education

JEL Classification: G11, I23, L31

Suggested Citation

Gottesman, Aron A. and Ismailescu, Iuliana, Student Selectivity and Higher Education Institutions Credit Ratings (February 17, 2020). Journal of Financial Economic Policy, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3458916 or http://dx.doi.org/10.2139/ssrn.3458916

Aron A. Gottesman (Contact Author)

Pace University - Lubin School of Business - Department of Finance and Economics ( email )

One Pace Plaza
New York, NY 10038
United States
212-346-1912 (Phone)
212-346-1573 (Fax)

Iuliana Ismailescu

Pace University - Lubin School of Business ( email )

One Pace Plaza
New York, NY 10038
United States
212-618-6524 (Phone)

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