Student Financial Incentives and Constraints: Evidence from Grant Programs

Jeffrey Denning

My dissertation will examine the impacts of financial incentives on student outcomes while in college. My dissertation will reveal how federal grant programs influence student decisions about major choice, credit accumulation, timely graduation, and GPA. I will first examine the impact direct financial incentives that were designed to induce students to major in STEM (Science Technology Engineering Math) fields by examining the Federal SMART Grant. To accomplish this I will use student level data on all students at public universities in the state of Texas and a regression discontinuity design to uncover the causal effect of institutional financial incentives for major. This will allow me to shed light on how financial considerations impact major choice. My work on financial incentives is also of interest to policy makers who may want to affect the major choice of students. Additionally, I will examine the effects that the Pell Grant program has on student behavior in college. The assignment rule is such that some students who have very similar family backgrounds receive up to $976 more in Pell Grants while others do not. Using a regression discontinuity and a regression kink design and the same student level data, I will examine the causal impact of Pell Grant receipt on credit accumulation, degree completion, debt burden, full vs. part time student status, and GPA. Understanding the Pell Grant is crucial due to the prominent role that the Pell Grant plays in the United States higher education system.

About Jeffrey Denning

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