Additional College Aid Doesn’t Always Increase Completion Rates

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A new study that attempted to determine whether additional cash grants to college students who received Pell grants would push more of them to achieve their degrees has turned up mixed and somewhat confusing results.

                The program studied was the Wisconsin Scholars Grant, which awarded $1,750 per semester for as long as 10 semesters to members of the specially chosen group, as long as they were enrolled in a Wisconsin College, took a “full credit load” and maintained a C average.  Their progress was compared to a control group of students who would have qualified for the same program but did not receive the additional funds.

Because of the way student financial aid packages are determined – and the fact that the students who received the grants were chosen after classes began – the $1,750 grants didn’t translate exactly into that much additional money.  The grants had to be factored into the students’ overall grant packages, and thus offset some of the other financial aid the students received.  The $3,500 annual grants actually produced about $2,458 in additional funds.

The poorest students in the treatment group – often first generation college students and those who also were working while attending school – showed the largest gains, both in the number of credit hours earned and overall retention into the third year of the study.

On the other hand, the students whose families were better off financially – at least relatively, since the Pell grants only go to low-income students – and were more likely to include college-educated parents actually achieved fewer credits and made less progress than might have been expected toward graduation.  Students in the middle of the higher and lower groups accomplished about the same as the control group.

Researchers, all at the University of Wisconsin – Madison, are at something of a loss to explain the results, relying on sociological theories.  They suggest that the lower income students may have relied more on their families to help make decisions on how to spend the money and that the relatively higher income students were allowed more to decide on their own about expenditures.  They also theorize that some of the higher income students may have taken fewer courses, and perhaps less difficult courses, as a way to keep their grades high.

The researchers’ conclusion was that higher Pell Grants may not help students move toward graduation as much as might be presumed,  and that changing the Pell-required number of credit hours from 12 to 15 might be a better approach.

To read the entire report, Conditional Cash Transfers and College Persistence:
Evidence from a Randomized Need?Based Grant Program
click here.