FAFSA

Abstract: In this paper we investigate, through a randomized controlled trial design, the impact of a personalized text messaging intervention designed to encourage college freshmen to refile their Free Application for Federal Student Aid (FAFSA) and maintain their financial aid for sophomore year. The intervention produced large and positive effects among freshmen at community colleges where text recipients were almost 14 percentage points more likely to remain continuously enrolled through the Spring of sophomore year. By contrast, the intervention did not improve sophomore year persistence among freshmen at four-year institutions among whom the rate of persistence was already high.

Abstract: The federal system for distributing student financial aid rivals the tax code in its complexity. Both have been a source of frustration and a focus of reform efforts for decades, yet the complexity of the student aid system has received comparatively little attention from economists. We describe the complexity of the aid system, and apply lessons from optimal tax theory and behavioral economics to show that complexity is a serious obstacle to both efficiency and equity in the distribution of student aid. We show that complexity disproportionately burdens those with the least ability to pay and undermines redistributive goals. We use detailed data from federal student aid applications to show that a radically simplified aid process can reproduce the current distribution of aid using a fraction of the information now collected.

Abstract: Growing concerns about low awareness and take-up rates for government support programs like college financial aid have spurred calls to simplify the application process and enhance visibility. This project examines the effects of two experimental treatments designed to test of the importance of simplification and information using a random assignment research design. H&R Block tax professionals helped low- to moderate-income families complete the FAFSA, the federal application for financial aid. Families were then given an estimate of their eligibility for government aid as well as information about local postsecondary options. A second randomly-chosen group of individuals received only personalized aid eligibility information but did not receive help completing the FAFSA. Comparing the outcomes of participants in the treatment groups to a control group using multiple sources of administrative data, the analysis suggests that individuals who received assistance with the FAFSA and information about aid were substantially more likely to submit the aid application, enroll in college the following fall, and receive more financial aid. These results suggest that simplification and providing information could be effective ways to improve college access. However, only providing aid eligibility information without also giving assistance with the form had no significant effect on FAFSA submission rates.

Abstract: Do successful local nudge interventions maintain efficacy when scaled state or nationwide? We investigate, through two randomized controlled trials, the impact of a national and state-level campaign encouraging students to apply for financial aid for college. The campaigns collectively reached over 800,000 students, with multiple treatment arms patterned after prior local interventions in order to explore potential mechanisms. We find no impacts on aid receipt or college enrollment overall or for any subgroups. We find no evidence that different approaches to message framing, delivery, or timing, or access to one-on-one advising affected campaign efficacy. We discuss why nudge strategies that work locally may be hard to scale effectively.