Impact of Need-Based Financial Aid on Student Persistence at Public Institutions: An Application of the Regression-Discontinuity Design

44 Pages Posted: 10 Mar 2017

See all articles by William R. Doyle

William R. Doyle

Vanderbilt University

Jungmin Lee

University of Kentucky

Tuan Nguyen

Vanderbilt University

Date Written: March 9, 2017

Abstract

We take advantage of a unique program design to estimate the effect of financial aid on first-to-second year persistence. In Tennessee, need-based financial aid is given to eligible students on a first-come, first-served basis, based on when the student files the Free Application for Federal Student Aid. Using a regression-discontinuity design, we compare the persistence among eligible students who received need-based aid in the first and second years of college with eligible students who failed to to apply before the undisclosed cutoff date in the second year. Students at the University of Tennessee who retained their financial aid were 9.5 percentage points more likely to persist than students who lost their financial aid.

Keywords: Postsecondary Education; Financial Aid; Persistence; Higher Education; Policy

JEL Classification: J08, J18, J24

Suggested Citation

Doyle, William R and Lee, Jungmin and Nugyen, Tuan, Impact of Need-Based Financial Aid on Student Persistence at Public Institutions: An Application of the Regression-Discontinuity Design (March 9, 2017). Available at SSRN: https://ssrn.com/abstract=2930286 or http://dx.doi.org/10.2139/ssrn.2930286

William R Doyle (Contact Author)

Vanderbilt University ( email )

2301 Vanderbilt Place
Nashville, TN 37240
United States
615 322 2904 (Phone)

HOME PAGE: http://https://my.vanderbilt.edu/willdoyle/

Jungmin Lee

University of Kentucky ( email )

Lexington, KY 40506
United States

Tuan Nugyen

Vanderbilt University ( email )

2301 Vanderbilt Place
Nashville, TN 37240
United States

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