The Effects of Higher Student Loan Limits on Access to High-Earnings Graduate Programs

Graduate student debt is the predominant form of financial aid for postbaccalaureate students and represents almost half of outstanding student debt, yet little is known about the effect of publicly funded graduate loans on student outcomes. To fill this gap, we examine the creation of the federal Graduate PLUS Student Loan program, which effectively eliminated loan limits for graduate students. Using a difference-in-difference identification strategy and administrative data on graduate students entering public and nonprofit universities in Texas, we show that access to additional liquidity through Grad PLUS had no effect on underrepresented students' access to high-earnings graduate programs.