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Enrolment into Higher Education and Changes in Repayment Obligations of Student Aid – Microeconometric Evidence for Germany

Hans Baumgartner and Viktor Steiner
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Viktor Steiner: DIW Berlin

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Abstract: We evaluate the effect of the federal students’ financial assistance scheme (BAfoeG) on enrolment rates into higher education by exploiting the exogenous variation introduced through a discrete shift in the repayment regulations. Supported students had to repay the full loan until 1990. Thereafter, 50 percent of the student aid has been offered as a non-repayable grant. Our results from simple difference-in- difference estimates suggest that student aid is ineffective in raising enrolment rates. Our findings may have important implications for the current debate on the reform of financing higher education in Germany and elsewhere.

Keywords: educational decision; educational finance; higher education; difference-in-difference; discrete-choice (search for similar items in EconPapers)
JEL-codes: I28 I22 J24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dcm and nep-edu
Date: 2004-10-06
Note: Type of Document - pdf; pages: 28
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