IDEAS home Printed from https://ideas.repec.org/a/aea/aejpol/v11y2019i1p64-94.html
   My bibliography  Save this article

The Long-Run Impacts of Financial Aid: Evidence from California's Cal Grant

Author

Listed:
  • Eric Bettinger
  • Oded Gurantz
  • Laura Kawano
  • Bruce Sacerdote
  • Michael Stevens

Abstract

We examine the long-term impacts of California's state-based financial aid by tracking educational and labor force outcomes for up to 14 years after high school graduation. We identify program impacts by exploiting variation in eligibility rules using GPA and family income cutoffs that are ex ante unknown to applicants. Aid eligibility increases undergraduate and graduate degree completion, and for some subgroups, raises longer-run annual earnings and the likelihood that young adults reside in California. These findings suggest that the net cost of financial aid programs may frequently be overstated, though our results are too imprecise to provide exact cost-benefit estimates.

Suggested Citation

  • Eric Bettinger & Oded Gurantz & Laura Kawano & Bruce Sacerdote & Michael Stevens, 2019. "The Long-Run Impacts of Financial Aid: Evidence from California's Cal Grant," American Economic Journal: Economic Policy, American Economic Association, vol. 11(1), pages 64-94, February.
    • Handle: RePEc:aea:aejpol:v:11:y:2019:i:1:p:64-94
    Note: DOI: 10.1257/pol.20170466
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/pol.20170466
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/attachments?retrieve=IV5qv-eYTjZWwCls_D8EYwtBOziGV5Vo
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/attachments?retrieve=9Jfx-MT_R34zKxrwOOoSi4kWih51xLq9
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/attachments?retrieve=UUPFkRgz_UykSDLCzFwHyAx-ygRLhYtO
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Molina, Teresa & Rivadeneyra, Ivan, 2020. "The Schooling and Labor Market Effects of Eliminating University Tuition in Ecuador," IZA Discussion Papers 13638, Institute of Labor Economics (IZA).
    2. Denning, Jeffrey T. & Eide, Eric R. & Warnick, Merrill, 2019. "Why Have College Completion Rates Increased?," IZA Discussion Papers 12411, Institute of Labor Economics (IZA).
    3. Wright, Nicholas A., 2020. "Perform better, or else: Academic probation, public praise, and students decision-making," Labour Economics, Elsevier, vol. 62(C).

    More about this item

    JEL classification:

    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejpol:v:11:y:2019:i:1:p:64-94. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael P. Albert). General contact details of provider: http://edirc.repec.org/data/aeaaaea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.