The effect of student aid on the duration of study

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in DIW Berlin AbstractIn this paper I evaluate the effect of student aid on the success of academic studies. I focus on two dimensions, the duration of study and the probability of actually graduating with a degree. While there is an extensive literature on the impact of student aid on its intended outcome, the uptake of tertiary education, the impact on the outcome and on study incentives has been mainly ignored. But introducing student aid changes the students' budget constraint. The increase in the budget-set might lead to shorter time-to-degree if paid work is substituted by study time. I analyze the effect of financial student aid granted by the German Federal Education and Training Assistance Act (BAfoeG). To determine its impact, I estimate a discrete-time duration model allowing for competing risks to account for different exit states (graduation and dropout) using individual level panel data from the German Socio-Economic Panel (SOEP) for the years 1984-2007. My findings suggest that the duration of study is responsive to the type of financial support a student receives. There are three main results. First, student aid recipients finish faster than comparable students who are supported by the same amount of parental/private transfers only. Second, although higher financial aid does on average not affect the duration of study, this effect is (third) dominated by the increased probability of actually finishing university successfully.

What works to improve student success

“…Similar results were obtained by Glocker (2011), who focused on two aspects: the duration of the students' career and the probability of actually graduating with a degree. Applying a discrete-time duration model on German university students from 1984 to 2007, she found that students who obtained aid actually experienced lower dropout, but did not graduate faster.…”

Bridging the “two cultures” in ethnopharmacology: Barriers against interdisciplinarity in postgraduate education

“…Students with fellowships and research assistantships have higher completion rates and shorter time-to-degree than students with teaching assistantships, tuition waivers, or those who support themselves (Ehrenberg and Mavros, 1995;Siegfried and Stock, 2006). This was also observed in Germany even when parental or private transfers and student aid recipients were awarded the same amount of financial aid (Glocker, 2011).…”

Working while studying: does it lead to greater attachment to the regional labour market?

“…High-intensity work during studying is observed to slow academic progression in the United States (US) (Darolia, 2014), Italy (Triventi, 2014), France (Body et al, 2014), the United Kingdom (UK) (Jewell, 2014) and Finland (Häkkinen and Uusitalo, 2003). By contrast, student aid reforms that increased conditional financial aid in Germany (Glocker, 2011) and in Norway (Gunnes et al, 2013) enhanced on-time graduation.…”