Presenter: Shinyoung Kim

Location: 368A Heady Hall

Title: The Effects of Losing Pell Grant Eligibility on Student Outcomes

Abstract: This paper examines the effects of Pell Grant eligibility on student outcomes. Using a regression discontinuity (RD) design and a partial identification approach, the study provides bounds on the treatment effects that account for selection effects arising from the loss of grant eligibility. While initial eligibility is determined by financial need alone, students must achieve Satisfactory Academic Progress (SAP) to retain the grant. The findings show that students eligible for the maximum grant aid are 26 percentage points less likely to persist in the year they lose grant eligibility than those with less aid. This negative effect on persistence extends to graduation; these students are 8 percentage points less likely to graduate within 4 years. I show that these two groups of students differ in their underlying characteristics, which introduces attrition bias into the estimates. Finally, to address this selection bias, I provide bounds on the treatment effects. While naive RD estimates find no effect on 4-, 5-, and 6-year graduation rates, bounding estimates reveal that, on average, students eligible for the maximum grant aid are 6, 3, and 4 percentage points more likely to graduate within 4, 5, and 6 years compared to those with less aid, respectively. These positive effects are larger than those found in earlier literature.