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Financial assistance for study abroad students: An economic analysis

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  • Lien, Donald
  • Liu, Gang

Abstract

This paper examines the scholarship payback policy embedded in a study abroad program. A full payback policy requires a student to return the whole amount of the scholarship should he fail to achieve a target post-program performance, whereas a partial payback policy requires a payback amount in proportion to the extent of the under-performance. It is found that, the university should adopt a fixed amount scholarship to maximize the average post-program ability. There is also an optimal partial payback policy.

Suggested Citation

  • Lien, Donald & Liu, Gang, 2010. "Financial assistance for study abroad students: An economic analysis," International Review of Economics & Finance, Elsevier, vol. 19(3), pages 515-522, June.
    • Handle: RePEc:eee:reveco:v:19:y:2010:i:3:p:515-522
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    References listed on IDEAS

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    1. Manon Domingues Dos Santos & Fabien Postel-Vinay, 2003. "Migration as a source of growth: The perspective of a developing country," Journal of Population Economics, Springer;European Society for Population Economics, vol. 16(1), pages 161-175, February.
    2. Donald Lien, 2007. "The Role of Scholarships in Study Abroad Programs," Education Economics, Taylor & Francis Journals, vol. 15(2), pages 203-213.
    3. Martin, Robert E., 2004. "Tuition discounting without tears," Economics of Education Review, Elsevier, vol. 23(2), pages 177-189, April.
    4. Dennis Epple & Richard Romano & Holger Sieg, 2006. "Admission, Tuition, and Financial Aid Policies in the Market for Higher Education," Econometrica, Econometric Society, vol. 74(4), pages 885-928, July.
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