Need-Based Financing Policies, College Decision-Making and Labor Market Behavior

Nicholas Wright

Designing an effective framework for financing higher education is a major issue facing policymakers in developed and developing countries. While we have a good understanding of how college financing options affect students’ college outcomes in developed countries, less is known about the impact of these programs in developing countries. In general, not much work has been done on how need-based financing programs alter students’ work-study trade-off and their labor market outcomes after college. In this paper, I employ several quasi-experimental designs and novel administrative data from Jamaica to estimate the effect of need-based grants and student-loan financing on students’ college outcomes and labor market behavior during college and in the early years after college. The results indicate that the students who benefited from either program had a higher GPA, graduated at higher rates and were more likely to remain in college beyond their third year. While both programs induce treated students to reduce labor market engagement during college, I found that they affected annual earnings differently in the early years after expected graduation.

About Nicholas Wright

Nicholas Wright is a Ph.D. Candidate in the Economics Department at Georgia State University. His research utilizes quasi-experimental methods to study issues in education, labor, and public economics, with a primary focus on higher education policies, experimental interventions, and student financing. His most recent works utilize administrative data from Jamaica to examine the impact of need-based financing policies, performance standards, and public recognition on students’ post-secondary decisions and labor market outcomes. Nic has served as a research assistant at the Federal Reserve Bank of Atlanta and has taught courses in econometrics and the economics of poverty and public policy at Georgia State University. Prior to Georgia State, he received a B.Sc. in Economics and Political Science and an M.Sc. in Economics from the University of the West Indies.