ERIC Number: EJ785256
Record Type: Journal
Publication Date: 2008-Feb
Reference Count: 0
Exploring the Effects of Financial Aid on the Gap in Student Dropout Risks by Income Level
Chen, Rong; DesJardins, Stephen L.
Research in Higher Education, v49 n1 p1-18 Feb 2008
Using national survey data and discrete-time logit modeling, this research seeks to understand whether student aid mediates the relationship between parental income and student dropout behavior. Our analysis confirms that there is a gap in dropout rates for low-income students compared with their upper income peers, and suggests that some types of aid are associated with lower risks of dropout. Thus, we examine the interaction between financial aid type and parental income to explore whether, and if so how, different types of aid may reduce the dropout gap by income level group. We find that the receipt of a Pell grant is related to narrowing the dropout gap between students from low- and middle-income groups, although overall the interaction between Pell grant and income is not significant. Loans and work-study aid both have similar effects on student dropout across all income groups. Methodologically, our results demonstrate the need to model dropout behavior temporally and to avoid main-effect bias by incorporating interaction effects.
Descriptors: Family Income, Dropout Rate, Dropouts, Risk, Student Financial Aid, Grants, Higher Education
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Publication Type: Journal Articles; Reports - Evaluative
Education Level: Higher Education
Authoring Institution: N/A