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Does More Generous Student Aid Increase Enrolment Rates into Higher Education?: Evaluating the German Student Aid Reform of 2001

  • Hans J. Baumgartner
  • Viktor Steiner

Students from low-income families are eligible to student aid under the federal students' financial assistance scheme (BAfoeG) in Germany. We evaluate the effectiveness of a recent reform of student aid that substantially increased the amount received by eligible students to raise enrolment rates into tertiary education. We view this reform as a 'natural experiment' and apply the difference-in-difference methodology using a discrete-time hazard rate model to estimate the causal effect on enrolment rates into higher education. We find that the reform had a small positive but statistically insignificant effect on enrolment rates.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.44113.de/dp563.pdf
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Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 563.

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Length: 23 p.
Date of creation: 2006
Date of revision:
Handle: RePEc:diw:diwwpp:dp563
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  1. John Shea, 1997. "Does Parents' Money Matter?," NBER Working Papers 6026, National Bureau of Economic Research, Inc.
  2. Bridget Terry Long, 2003. "The Impact of Federal Tax Credits for Higher Education Expenses," NBER Working Papers 9553, National Bureau of Economic Research, Inc.
  3. Ira N. Gang & Klaus F. Zimmermann, 2000. "Is Child like Parent? Educational Attainment and Ethnic Origin," Journal of Human Resources, University of Wisconsin Press, vol. 35(3), pages 550-569.
  4. Susan M. Dynarski, 1999. "Does Aid Matter? Measuring the Effect of Student Aid on College Attendance and Completion," NBER Working Papers 7422, National Bureau of Economic Research, Inc.
  5. Hans J. Baumgartner & Viktor Steiner, 2004. "Enrolment into Higher Education and Changes in Repayment Obligations of Student Aid – Microeconometric Evidence for Germany," HEW 0410003, EconWPA.
  6. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  7. Joshua Angrist & Alan Krueger, 1998. "Empirical Strategies in Labor Economics," Working papers 98-7, Massachusetts Institute of Technology (MIT), Department of Economics.
  8. Susan Dynarski, 2002. "The Behavioral and Distributional Implications of Aid for College," American Economic Review, American Economic Association, vol. 92(2), pages 279-285, May.
  9. Anders Skrondal & Sophia Rabe-Hesketh, 2007. "Latent Variable Modelling: A Survey," Scandinavian Journal of Statistics, Danish Society for Theoretical Statistics;Finnish Statistical Society;Norwegian Statistical Association;Swedish Statistical Association, vol. 34(4), pages 712-745.
  10. Meyer, Bruce D, 1995. "Natural and Quasi-experiments in Economics," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 151-61, April.
  11. Richard Blundell & Monica Costa Dias, 2000. "Evaluation methods for non-experimental data," Fiscal Studies, Institute for Fiscal Studies, vol. 21(4), pages 427-468, January.
  12. Heckman, James J. & Singer, Burton, 1984. "Econometric duration analysis," Journal of Econometrics, Elsevier, vol. 24(1-2), pages 63-132.
  13. Thomas J. Kane, 1995. "Rising Public College Tuition and College Entry: How Well Do Public Subsidies Promote Access to College?," NBER Working Papers 5164, National Bureau of Economic Research, Inc.
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