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Improving College Access and Success for Low-Income Students: Evidence from a Large Need-Based Grant Program

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  • Gabrielle Fack
  • Julien Grenet

Abstract

Using comprehensive administrative data on France's single largest financial aid program, this paper provides new evidence on the impact of large-scale need-based grant programs on the college enrollment decisions, persistence, and graduation rates of low-income students. We exploit sharp discontinuities in the grant eligibility formula to identify the impact of aid on student outcomes at different levels of study. We find that the provision of 1,500 euros cash allowances to prospective undergraduate or graduate students increases their college enrollment rates by 5 to 7 percent. Moreover, we show that need-based grants have positive effects on student persistence and degree completion. (JEL H52, I22, I24, I28, J24)

Suggested Citation

  • Gabrielle Fack & Julien Grenet, 2015. "Improving College Access and Success for Low-Income Students: Evidence from a Large Need-Based Grant Program," American Economic Journal: Applied Economics, American Economic Association, vol. 7(2), pages 1-34, April.
  • Handle: RePEc:aea:aejapp:v:7:y:2015:i:2:p:1-34
    Note: DOI: 10.1257/app.20130423
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    References listed on IDEAS

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    1. Thomas J. Kane, 2007. "Evaluating the Impact of the D.C. Tuition Assistance Grant Program," Journal of Human Resources, University of Wisconsin Press, vol. 42(3).
    2. Dynarski, Susan, 2000. "Hope for Whom? Financial Aid for the Middle Class and Its Impact on College Attendance," National Tax Journal, National Tax Association;National Tax Journal, vol. 53(3), pages 629-662, September.
    3. Neil S. Seftor & NSarah E. Turner, 2002. "Back to School: Federal Student Aid Policy and Adult College Enrollment," Journal of Human Resources, University of Wisconsin Press, vol. 37(2), pages 336-352.
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    Citations

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    Cited by:

    1. Lucia Rizzica, 2018. "Raising aspirations and higher education: evidence from the UK’s Widening Participation policy," Temi di discussione (Economic working papers) 1188, Bank of Italy, Economic Research and International Relations Area.
    2. Azzolini, Davide & Martini, Alberto & Rettore, Enrico & Romano, Barbara & Schizzerotto, Antonio & Vergolini, Loris, 2018. "Testing a Social Innovation in Financial Aid for Low-Income Students: Experimental Evidence from Italy," IZA Discussion Papers 11625, Institute of Labor Economics (IZA).
    3. Teresa Molina & Ivan Rivadeneyra, 2019. "The Labor Market Effects of Eliminating University Tuition in Ecuador," Working Papers 201901, University of Hawaii at Manoa, Department of Economics.
    4. repec:eee:labeco:v:47:y:2017:i:c:p:48-63 is not listed on IDEAS
    5. Bonin, Holger, 2017. "The Potential Economic Benefits of Education of Migrants in the EU," IZA Research Reports 75, Institute of Labor Economics (IZA).
    6. Juliana Londoño-Velez & Catherine Rodriguez & Fabio Sánchez?, 2017. "The Intended and Unintended Impacts of a Merit-Based Financial Aid Program for the Poor: The Case of Ser Pilo Paga," Documentos CEDE 015466, Universidad de los Andes - CEDE.
    7. Arenas, Andreu & Malgouyres, Clément, 2018. "Countercyclical school attainment and intergenerational mobility," Labour Economics, Elsevier, vol. 53(C), pages 97-111.
    8. Zurab Abramishvili & Lasha Lanchava, 2015. "Education for the Poor," CERGE-EI Working Papers wp542, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    9. Lergetporer, Philipp & Werner, Katharina & Woessmann, Ludger, 2018. "Educational Inequality and Public Policy Preferences: Evidence From Representative Survey Experiments," Rationality and Competition Discussion Paper Series 110, CRC TRR 190 Rationality and Competition.
    10. George Bulman & Robert Fairlie & Sarena Goodman & Adam Isen, 2016. "Parental Resources and College Attendance: Evidence from Lottery Wins," NBER Working Papers 22679, National Bureau of Economic Research, Inc.
    11. repec:ces:ifobei:82 is not listed on IDEAS
    12. Rachid Laajaj & Andres Moya & Fabio Sánchez, 2018. "Equality of Opportunity and Human Capital Accumulation: Motivational Effect of a Nationwide Scholarship in Colombia," Documentos CEDE 016352, Universidad de los Andes - CEDE.
    13. Melguizo, Tatiana & Sanchez, Fabio & Velasco, Tatiana, 2016. "Credit for Low-Income Students and Access to and Academic Performance in Higher Education in Colombia: A Regression Discontinuity Approach," World Development, Elsevier, vol. 80(C), pages 61-77.
    14. José García-Montalvo, 2018. "The Impact of Progressive Tuition Fees on Dropping Out of Higher Education: A Regression Discontinuity Design," Working Papers 1017, Barcelona Graduate School of Economics.
    15. José Garcia Montalvo, 2018. "The impact of progressive tuition fees on dropping out of higher education: a regression discontinuity design," Economics Working Papers 1597, Department of Economics and Business, Universitat Pompeu Fabra.
    16. Mathieu Lefebvre & Anne Stenger, 2016. "Long-lasting effects of temporary incentives in public good games," Working Papers of BETA 2016-25, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.

    More about this item

    JEL classification:

    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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