During the post-World War II era, U.S. governmental policy has often been based on the idea that (in the absence of government action) access to college and, to a lesser extent, high school education may be limited because of liquidity constraints. The federal and state and local governments have instituted a number of policies to overcome these constraints. These policies include the Basic Opportunity Grants, loan programs that have been issued at or below market interest rates, the expansion of state-supported colleges that charge below-market tuitions rates, and the inception and expansion of local community or county colleges that also charge below-market tuition rates. While there may be noneconomic reasons that explain these changes or their magnitude, economic reasons, that rely on differences between private and social costs and benefits, can also be advanced. These include: (a) wiser societal choices made by a more educated society; (b) recoupment of social costs from higher tax revenues; (c) the reduction of private risks from lending arising from the pooling of risks thereby making the social supply of funds curve available to all individuals at the social discount rate; and (d) state and local economic development. Reason c implies that in the absence of governmental initiative some children would be restricted from achieving their socially optimal amount of education because parents' income and wealth limit their children's choices. Gary Becker (1975), Arthur Okun (1975), and Jere Behrman and myself (1985) argue that governmental policy to reduce private borrowing costs to the level of social costs reduces inefficiency while increasing equity-a rare result in the realm of economics. In this paper I consider why parental income might influence offspring's educational attainment and the policy implications of such an influence.

We modify R. A. Fisher's model by incorporating measures of the environment that may be correlated across kin groups. We estimate a model of schooling attainment using data on eight kin groups and find a large contribution of genetic endowments to the variance in schooling though certain aspects of the environment matter.

Unequal access to financing for education may be an important source of educational differences. We develop a model relating sib schooling and earnings similarities to sibship size with and without equal access and estimate it for the education of veterans, for whom the GI Bill assured equal access, and for their children, who had no such government assistance. We find an inverse relationship between sibship size and sib schooling and earnings similarities for the children, but not for the veterans; we conclude that, in the absence of equal access policies, unequal access is an important source of educational differences.

We modify R. A. Fisher's model by incorporating measures of the environment that may be correlated across kin groups. We estimate a model of schooling attainment using data on eight kin groups and find a large contribution of genetic endowments to the variance in schooling though certain aspects of the environment matter.

Unequal access to financing for education may be an important source of educational differences. We develop a model relating sib schooling and earnings similarities to sibship size with and without equal access and estimate it for the education of veterans, for whom the GI Bill assured equal access, and for their children, who had no such government assistance. We find an inverse relationship between sibship size and sib schooling and earnings similarities for the children, but not for the veterans; we conclude that, in the absence of equal access policies, unequal access is an important source of educational differences.