Abstract
The adoption of state-funded merit-based aid programs has become increasingly popular among policy-makers, particularly in the southeastern part of the United States. One of the primary rationales of state-funded merit-based aid is to provide scholarships to the best and brightest students as a means to retain high quality human capital in the state’s labor market. Previous literature largely examines the link between state-funded merit-based aid and instate college enrollment, but it has not extensively examined the link between state-administered merit aid and subsequent instate labor market participation. In this study, we use statewide administrative datasets to estimate the effects of Missouri’s Bright Flight Scholarship program, a highly targeted state administered merit aid program, on future instate employment. Using a regression discontinuity approach on the intent to treat, we find that having the opportunity to participate in the Bright Flight Scholarship program has a positive impact on the likelihood of working in the state 8 years after high school graduation. Overall, this study provides evidence that highly targeted state-funded merit-based financial aid programs may have a positive impact on reducing state brain drain.
Similar content being viewed by others
Notes
As of 2014, the eligibility rules were changed with the implementation of the two-tier award structure. The state provides an award of $3000 for Missouri high school graduates with an ACT score of 31 or higher, and an award of $1000 for an ACT score of 30. These changes are outside of the analysis period for this study, thus, do not impact our study.
At least a 3.5 GPA and score of 1270 SAT (28 ACT) for full tuition. At least a 3.0 GPA and score of 970 SAT (20 ACT) for 75 % of tuition.
However, it should be noted that is still possible for an individual to be hired in the second, third, or fourth quarter of that year, which would go undetected using first quarter data.
Explanations for our choice of preferred functional form and analytical sample are explained below.
Results for model estimates using a probit estimator can be obtained at request of the authors.
Results of the cubic functional form models will be provided upon a request of the authors.
References
ACT Inc. (n.d.). Selections from the 1999 national score report. Retrieved from http://www.act.org/newsroom/data/1999/99data.html.
Becker, G. S. (1962). Investment in human capital: A theoretical analysis. Journal of Political Economy, 70(5), 9–49.
Binder, M., & Ganderton, P. T. (2004). The New Mexico lottery scholarship: Does it help minority and low-income students? In D. E. Heller & P. Marin (Eds.), State merit scholarship program and racial inequality (pp. 101–122). Cambridge, MA: The Civil Rights Project at Harvard University.
Bloom, H. S. (2012). Modern regression discontinuity analysis. Journal of Research on Educational Effectiveness, 5(1), 43–82.
Cornwell, C., & Mustard, D. (2002). Race and the effects of Georgia’s HOPE Scholarship? In D. E. Heller & P. Marin (Eds.), Who should we help? The negative social consequences of merit scholarships (pp. 57–72). Cambridge, MA: The Civil Rights Project, Harvard University.
Cornwell, C., Mustard, D. B., & Sridhar, D. J. (2006). The enrollment effects of merit-based financial aid: Evidence from Georgia’s HOPE scholarship. Journal of Labor Economics, 24(4), 761–786.
Doyle, W. R. (2006). Adoption of merit-based student grant programs: An event history analysis. Educational Evaluation and Policy Analysis, 28(3), 259–285.
Doyle, W. R. (2010). Does merit-based aid “crowd out” need based aid? Research in Higher Education, 51(5), 397–415.
Dynarski, S. (2002). Race, income, and the impact of merit aid. In D. E. Heller & P. Marin (Eds.), Who should we help? The negative social consequences of merit scholarships (pp. 73–92). Cambridge, MA: The Civil Rights Project at Harvard University.
Dynarski, S. (2004). The new merit aid. In C. M. Hoxby (Ed.), College choices: The economics of where to go, when to go, and how to pay for it (pp. 63–100). Chicago, IL: University of Chicago Press.
Fitzpatrick, M. D., & Jones, D. (2012). Higher education, merit-based scholarships and post-baccalaureate migration (No. w18530). Cambridge, MA: National Bureau of Economic Research.
Gelman, A., & Imbens, G. (2014). Why high-order polynomials should not be used in regression discontinuity designs (No. w20405). Cambridge, MA: National Bureau of Economic Research.
Groen, J. A. (2004). The effect of college location on migration of college-educated labor. Journal of Econometrics, 121(1–2), 125–142.
Heller, D. E. (2002). State merit scholarship programs: An introduction. In D. E. Heller & P. Marin (Eds.), Who should we help? The negative social consequences of merit scholarships (pp. 15–24). Cambridge, MA: The Civil Rights Project at Harvard University.
Heller, D. E., & Marin, P. (Eds.). (2004). State merit scholarship program and racial inequality. Cambridge, MA: The Civil Rights Project at Harvard University.
Heller, D. E., & Rasmussen, C. J. (2002). Merit scholarships and college access: Evidence from Florida and Michigan. In D. E. Heller & P. Marin (Eds.), Who should we help? The negative social consequences of merit scholarships (pp. 25–40). Cambridge, MA: The Civil Rights Project at Harvard University.
Hickman, D. C. (2009). The effects of higher education policy on the location decision of individuals: Evidence from Florida’s Bright Futures Scholarship Program. Regional Science and Urban Economics, 39(5), 553–562.
Lee, D. S., & Card, D. (2008). Regression discontinuity inference with specification error. Journal of Econometrics, 142(2), 655–674.
Lee, D. S., & Lemieux, T. (2010). Regression Discontinuity Designs in Economics. Journal of Economic Literature, 48(2), 281–355.
Ludwig, M. & Wassan, H. (1988). Student Charges at public institution: Annual survey 1987–88.
McCrary, J. (2008). Manipulation of the running variable in the regression discontinuity design: A density test. Journal of Econometrics, 142(2), 698–714.
Missouri Department of Higher Education (2010). DHE financial assistance and outreach. http://dhe.mo.gov/files/research/statsum/table23_25_0910.pdf.
Moretti, E. (2004). Estimating the social return to higher education: Evidence from longitudinal and repeated cross-sectional data. Journal of Econometrics, 12(1), 175–212.
Orsuwan, M., & Heck, R. H. (2009). Merit-based student aid and freshman interstate college migration: Testing a dynamic model of policy change. Research in Higher Education, 50(1), 24–51.
Schochet, P., Cook, T., Deke, J., Imbens, G., Lockwood, J. R., Porter, J., & Smith, J. (2010). Standards for regression discontinuity designs. Retrieved from What Works Clearinghouse website: http://ies.ed.gov/ncee/wwc/pdf/wwc_rd.pdf.
Schultz, T. W. (1961). Investment in human capital. The American Economic Review, 51(1), 1–17.
Singell, L. D, Jr, Waddell, G. R., & Curs, B. R. (2006). Hope for the Pell? The impact of merit-aid on needy students. Southern Economic Journal, 73, 79–99.
Sjoquist, D. L., & Winters, J. V. (2012). Building the stock of college-educated labor revisited. Journal of Human Resources, 47(1), 270–285.
Sjoquist, D. L., & Winters, J. V. (2013). The effects of HOPE on post-college retention in the Georgia workforce. Regional Science and Urban Economics, 43(3), 479–490.
Sjoquist, D. L., & Winters, J. V. (2015). State merit-based financial aid programs and college attainment. Journal of Regional Science, 55(3), 364–390.
Toutkoushian, R. K., & Hillman, N. W. (2012). The impact of state appropriations and grants on access to higher education and outmigration. The Review of Higher Education, 36(1), 51–90.
Trostel, P. A. (2010). The fiscal impacts of college attainment. Research in Higher Education, 51(3), 220–247.
Zhang, L., & Ness, E. C. (2010). Does state merit-based aid stem brain drain? Educational Evaluation and Policy Analysis, 32(2), 143–165.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Harrington, J.R., Muñoz, J., Curs, B.R. et al. Examining the Impact of a Highly Targeted State Administered Merit Aid Program on Brain Drain: Evidence from a Regression Discontinuity Analysis of Missouri’s Bright Flight Program. Res High Educ 57, 423–447 (2016). https://doi.org/10.1007/s11162-015-9392-9
Received:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11162-015-9392-9