The impact of student loans on educational attainment: The case of a program at the Pontifical Catholic University of Peru

En las últimas décadas, la Pontificia Universidad Católica del Perú (PUCP) ha otorgado préstamos estudiantiles a algunos estudiantes con rendimiento académico satisfactorio pero que enfrentan problemas económicos que pudieran poner en peligro su continuidad como estudiantes. Aunque el programa fue creado hace más de cuarenta años, sus resultados nunca han sido evaluados en forma rigurosa. Este documento intenta evaluar hasta qué punto el programa ha beneficiado a los estudiantes. Debido a que la información disponible proviene de records académicos, el cumplimiento de este objetivo requiere el uso de técnicas modernas diseñadas para trabajar con datos no experimentales. Estimando por el método de propensity score matching, encuentro un impacto estadísticamente significativo sobre el número de semestres necesarios para culminar los estudios solo cuando el estudiante recibió el préstamo por 6 semestres o más. También se encontró un impacto significativo sobre la probabilidad de concluir los estudios seis años y medio después de haberlos iniciado, para el caso de estudiantes que recibieron el préstamo por 6 semestres o más. Sin embargo, tal efecto es pequeño. Abstract During the past decades, the Pontifical Catholic University of Peru (known as PUCP) has been giving student loans to some of its students with satisfactory academic performance but who face certain economic problems which might interrupt their studies. Although this program was created more than forty years ago, its results have not been rigorously evaluated. This document attempts to assess to what extent the program has benefited students. Because the collected data come from academic 2 and social records, the completion of this task requires using modern techniques specifically designed to work with non experimental data. After estimating by propensity score matching with multiple treatments, I find a statistically significant impact of this program on the time a student employs to complete the course of study at PUCP (measured in semesters) only when a student was awarded with a loan for 6 semesters or more. That effect is not significantly different from zero when the loan lasts less than 6 semesters. Similar results were found when I analyzed the impact on the probability of degree completion of student loans, where students with loan were more likely to meet all graduation requirements by 6 years and a half after they start studying at PUCP. Again this effect was significant only when the student participates in the program for six semesters or more. However, the impact on that probability was small. JEL Classification Codes: C13, C14, C21, I22 Key Words: Student Loans, Matching, Treatment Effect