Money for nothing: estimating the impact of student aid on participation in Higher Education
Understanding how finance policy can affect higher education is important for understanding how governments can promote human capital accumulation. Yet there is a severe lack of evidence on the effectiveness of student aid on HE participation outside of the US, and none at all for the UK. This paper exploits a reform that took place in the UK in 2004, when maintenance grants were re-introduced for students from low income families, having been abolished since 1999. This reform occurred in isolation of any other policy changes, and did not affect students from relatively better off families, making them a potential control group. We use a difference in difference framework to estimate its effects on degree participation. We find a positive impact of maintenance grants on degree participation, with a Â£1,000 increase in grants leading to a 3.95ppt increase in participation. This finding is in line with US studies.
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- Lorraine Dearden & Emla Fitzsimons & Alissa Goodman & Greg Kaplan, 2007.
"Higher education funding reforms in England: the distributional effects and the shifting balance of costs,"
IFS Working Papers
W07/18, Institute for Fiscal Studies.
- Lorraine Dearden & Emla Fitzsimons & Alissa Goodman & Greg Kaplan, 2008. "Higher Education Funding Reforms in England: The Distributional Effects and the Shifting Balance of Costs," Economic Journal, Royal Economic Society, vol. 118(526), pages F100-F125, 02.
- Hemelt, Steven W. & Marcotte, Dave E., 2008. "Rising Tuition and Enrollment in Public Higher Education," IZA Discussion Papers 3827, Institute for the Study of Labor (IZA).
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