Research Details

Abstract

We study the equilibrium impact of student aid design in the United States market for sub-baccalaureate higher education. Using data from the universe of aid-eligible colleges, we estimate each college's quality, and an equilibrium model determining choices in this market. We use this model to estimate a host of counterfactual policies, including a targeted voucher policy aimed at maximizing quality of education. This policy highlights that for-profit colleges, despite being lower quality, are more effective at increasing enrollment than public community colleges. Consequently, these schools play an important role in improving the educational outcomes of students.

Type

Working Paper

Author(s)

Shengmao Cao, Luis Armona

Date Published

2022

Citations

Cao, Shengmao, and Luis Armona. 2022. Redesigning Federal Student Aid in Higher Education.