The Long-Run Impacts of Financial Aid: Evidence from California's Cal Grant

Eric Bettinger, Oded Gurantz, Laura Kawano, Bruce Sacerdote () and Michael Stevens

American Economic Journal: Economic Policy, 2019, vol. 11, issue 1, 64-94

Abstract: We examine the long-term impacts of California's state-based financial aid by tracking educational and labor force outcomes for up to 14 years after high school graduation. We identify program impacts by exploiting variation in eligibility rules using GPA and family income cutoffs that are ex ante unknown to applicants. Aid eligibility increases undergraduate and graduate degree completion, and for some subgroups, raises longer-run annual earnings and the likelihood that young adults reside in California. These findings suggest that the net cost of financial aid programs may frequently be overstated, though our results are too imprecise to provide exact cost-benefit estimates.

JEL-codes: H75 I21 I22 I23 I26 I28 (search for similar items in EconPapers)
Date: 2019
Note: DOI: 10.1257/pol.20170466
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Citations: View citations in EconPapers (29)

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