Economics Seminar Series with Scott Carrell

Scott Carrell is a Professor of Economics, Associate Dean of Faculty Affairs in the School of Civic Leadership and a Faculty Fellow of the Civitas Institute at the University of Texas at Austin. He is presenting 

Cash for Class: The Effect of Paying Students for Full-Time Community College Enrollment 

Abstract:  Despite enrolling nearly half of U.S. undergraduates, completion rates in community colleges remain far below those in four-year colleges. Community college students are much more likely to be enrolled only part-time and to face financial hardships resulting from coming from lower-income backgrounds. This study examines the impact of eligibility for the largest financial aid program in California, the Cal Grant B, which offers low-income community college students financial assistance for living expenses. It also includes large supplements (up to $8,000 per year) for students who enroll in enough units per term to finish an associate degree within two years. Using a regression discontinuity design applied to statewide data from the community college and financial aid systems, we find little evidence that Cal Grant B eligibility improves student outcomes, including enrolling in enough units to trigger the supplemental aid. However, for students who happened to have enrolled in enough units to receive the supplemental aid, we find that grant eligibility improves several indicators of postsecondary attainment. Evidence from student surveys suggest information frictions may undermine the effectiveness of the program.