Optimal Need-Based Financial Aid

• 成果类型: Article
• 署名作者: Colas, Mark; Findeisen, Sebastian; Sachs, Dominik
• 署名单位: University of Oregon; University of Konstanz; University of Munich
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/711952
• 发表日期: 2021
• 页码: 492-533
• 关键词: dynamic discrete-choice; education subsidies; borrowing constraints; taxation; tax; enrollment; policies; returns; income; MODEL

摘要

We study the optimal design of student financial aid as a function of parental income. We derive optimal financial aid formulas in a general model. We estimate a model of selection into college for the United States that comprises multidimensional heterogeneity, endogenous parental transfers, dropout, labor supply in college, and uncertain returns. We quantify optimal financial aid in the estimated model and find it is strongly declining in parental income even without distributional concerns. Equity and efficiency go hand in hand.