AEA Papers and Proceedings
ISSN 2574-0768 (Print) | ISSN 2574-0776 (Online)
Attainment Effects of Student Loans and Pell Grants
AEA Papers and Proceedings
vol. 109,
May 2019
(pp. 223–26)
Abstract
We estimate attainment effects of financial aid at a large community college. Using variation from a field experiment that altered how the college presented loans and a discontinuity in the Pell Grant formula, we separately identify the effects of grant aid and loans on short-run attainment. Although increases in Pell Grant aid cause students to reduce their borrowing, our experiment allows us to partial out the effect of any borrowing response on attainment. Both grants and loans significantly increase credits completed and grades.Citation
Marx, Benjamin M., and Lesley J. Turner. 2019. "Attainment Effects of Student Loans and Pell Grants." AEA Papers and Proceedings, 109: 223–26. DOI: 10.1257/pandp.20191015Additional Materials
JEL Classification
- H52 National Government Expenditures and Education
- I22 Educational Finance; Financial Aid
- I23 Higher Education; Research Institutions
- I28 Education: Government Policy