March 2006

IZA DP No. 2034: Does More Generous Student Aid Increase Enrolment Rates into Higher Education? Evaluating the German Student Aid Reform of 2001

来自低收入家庭的学生families are eligible to student aid under the federal students' financial assistance scheme (BAfoeG) in Germany. We evaluate the effectiveness of a recent reform of student aid that substantially increased the amount received by eligible students to raise enrolment rates into tertiary education. We view this reform as a 'natural experiment' and apply the difference-in-difference methodology using a discrete-time hazard rate model to estimate the causal effect on enrolment rates into higher education. We find that the reform had a small positive but statistically insignificant effect on enrolment rates.