Why Are Youth from Lower-income Families Less Likely to Attend University? Evidence from Academic Abilities, Parental Influences, and Financial Constraints

In this study, I use new Canadian data containing detailed information on academic abilities, parental influences, financial constraints, and other socio-economic background characteristics of youth to try to account for the large gap in university attendance across the income distribution. I find that 96% of the total gap in university attendance between youth from the top and bottom income quartiles can be accounted for by differences in observable characteristics. Differences in long-term factors such as standardized test scores in reading obtained at age 15, school marks reported at age 15, parental influences, and high-school quality account for 84% of the gap. In contrast, only 12% of the gap is related to financial constraints. Similar results hold across different income quartiles and when I use standardized test scores in mathematics and science. However, reading scores account for a larger proportion of the gap than other test scores.