American Economic Review: Insights
ISSN 2640-205X (Print) | ISSN 2640-2068 (Online)
The Power of Certainty: Experimental Evidence on the Effective Design of Free Tuition Programs
American Economic Review: Insights
vol. 5,
no. 3, September 2023
(pp. 293–310)
Abstract
Proposed "free college" policies vary widely in design. The simplest set tuition to zero for everyone. More targeted approaches limit free tuition to those who demonstrate need through an application process. We experimentally test the effects of these two models on the schooling decisions of low-income students. An unconditional free tuition offer from a large public university substantially increases application and enrollment rates. A free tuition offer contingent on proof of need has a much smaller effect on application and none on enrollment. These results are consistent with students placing a high value on financial certainty when making schooling decisions.Citation
Burland, Elizabeth, Susan Dynarski, Katherine Michelmore, Stephanie Owen, and Shwetha Raghuraman. 2023. "The Power of Certainty: Experimental Evidence on the Effective Design of Free Tuition Programs." American Economic Review: Insights, 5 (3): 293–310. DOI: 10.1257/aeri.20220094Additional Materials
JEL Classification
- H52 National Government Expenditures and Education
- H75 State and Local Government: Health; Education; Welfare; Public Pensions
- I22 Educational Finance; Financial Aid
- I23 Higher Education; Research Institutions
- I28 Education: Government Policy
- I32 Measurement and Analysis of Poverty