Estimating Effective Subsidy Rates of Student Aid Programs

摘要: Every year millions of high school students and their parents in the US are asked to fill out complicated financial aid application forms. However, few studies have estimated responsiveness government schemes changes needs students. This paper identifies effective subsidy rate (ESR) student aid, as defined by coefficient regression aid. The ESR measures proportion under assumption that all who enroll college apply for Problems self-selected applications considerable because more than one-third applicants ineligible any form aid; about 10 percent financially needy do not apply. I cope with endogenous estimating a Tobit-with-Selection model using maximum likelihood estimation methods. results show conventional OLS estimates considerably understate large portion from high-income families no My finding suggests it is important include evaluations programs.