Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/215282 
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 12886
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
In this paper we evaluate the impact of need-based grants on university drop-out rates in the first year of enrollment, using student-level administrative data from all Italian universities in the period 2003-2013. We exploit the fact that not all eligible students receive financial aid due to limited resources to generate a treatment and a control group. Using this partition, we estimate the average treatment effect, i.e. the average effect on low income students, controlling for a set of observable characteristics by running regressions on blocks defined on the propensity score. Results point towards a sizeable effect of grants in reducing dropping out from higher education: around one third of these students would have left university in the first year in absence of the grants. This evidence is robust to a variety of specifications and sample selection criteria.
Subjects: 
human capital
higher education
university dropout
student financial aid
blocking with regression adjustment
JEL: 
I22
I23
C21
C35
Document Type: 
Working Paper

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