Student Incentives

Student Incentives

Attainment and AffordabilityWashington Student Achievement Council

Olympia, May 23, 2013

 Nate Johnson, HCM StrategistsNate_Johnson@hcmstrategists.com

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College Productivity: Strategy Labs

With support from Lumina Foundation for Education, HCM Strategists helps states improve higher education attainment through site visits, networking opportunities, technical assistance, and timely nonpartisan research.

Lumina’s big goal: To increase the proportion of Americans with high-quality degrees and credentials to 60 percent by the year 2025

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Affordability and the Big Goal

• Costs of college – tuition, books, living expenses – exceed what many students and families can afford

• Federal, state and private grant programs fill some but not all of that financial need gap

• What is optimal way to allocate limited resources to maximize degree completion?

• Which students? How much? What conditions?

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How Would You Allocate $10,000?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

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Merit Aid?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

6

Highest Need First?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

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Equal Percentages of Need?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

8

Capped Proportions?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

9

First in Line?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

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Triage?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

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Variant: What If Some Choose a More Costly College?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

$20,000

$10,000

Unmet Financial NeedStudent (GPA, Application

Month)

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Variant: What if You Had $40,000? Or $2,000?

Emily (2.0, May)

Ketisha (3.5, Feb.)

Carlos (2.5, May)

Nick (2.5, June)

Taylor (3.5, Feb.)

Linda (4.0, Jan)

$- $30,000

$25,000

$15,000

$10,000

$5,000

$2,000

$-

Unmet Financial NeedStudent (GPA, Application

Month)

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Research-Based Idea #1: Aid Can Make a Difference for Low-Income Students

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Example: Performance-Based Scholarships

• Series of random trials by MDRC• Small supplemental scholarships ($600-

$1,500 per term) conditioned on passing courses with at least a “C”

• Consistently positive results• Source: Patel & Richburg-Hayes 2011

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Example: Performance-Based Scholarships Increase Number of

Students Meeting Progress Benchmarks

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Research-Based Idea #2: But Not Always. Targeting and Program Structure Make a Difference

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Example: Wisconsin Scholars Grant• Test of impact of extra money alone—no strings• Supplemental grants to Pell-eligible students• No additional conditions• Average supplement was $5,400 over two years• Statewide test—all Wisconsin two- and four-

year publics• Source: Goldrick-Rab, Harris, Benson &

Kelchen 2011

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Wisconsin Study Found Few Significant Differences in Academic Outcomes

5.2 5.2

Total Terms Enrolled in Three-Year Period

Wisconsin Schol-arship RecipientsControl Group

Source: Goldrick-Rab et al 2011

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Some students are more affected by aid and price than others

• Lack of targeting blunts impact of aid• Biggest effects found for:

– Low-income students– Lowest-income within low-income groups– Lowest GPA students within merit programs– The “highest-risk” students– Older students– Women

Summaryof

Rigorous Studies

on Impact of Aid by Subgroup

Source: Harris & Goldrick-Rab 2012

Example: Wisconsin Scholars Disaggregated by “Risk”

Most at risk Middle Least at risk

5.2 (signif-icant)

5.3 (not sig)

5.2 (signif-icant)

4.65.4 5.8

Terms Enrolled Within Three Year Period

Wisconsin Scholarship RecipientsControl Group

Source: Goldrick-Rab et al, 2011

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Research-Based Idea #3: Students Respond to Incentives to Take and Complete More Courses

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Example: West Virginia Promise Scholarship

Credits earned and terms enrolled increased

Requires students to complete 30 credits per year to renew

Source: Scott-Clayton 2009

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Example: Adams State College

• Majority minority, primarily Pell-eligible population• Inspired by Performance Based Scholarships• Implemented block tuition (flat rate for 12-18 credits)• Awarded small ($500) scholarships based on course

completions• Average fall course load increased from 12.2 to 13.5

Some Additional Findings

• Transparency and simplicity are critical• Strong communication/promotion can amplify effects• Short-term, concrete beats long-term, abstract (what

do you want students to do today/this term/this year?)

• Not every dollar of unmet need is equal

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Where Innovation is Happening• Indiana: Incentives for annual student progress;

students who complete 30 credits per year get maximum grants

• Colorado: State grant dollars allocated to institutions based on students’ progress

• Hawaii: Publicizing, promoting existing incentives (15-to-Finish campaign)

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