applying behavioral economics to public policy in canada behavioural economics incorporates ideas from psychology sociology and neuroscience to better predict how individuals make long term decisions often the ideas adopted include present or inattention bias both potentially leading to suboptimal outcomes but these models also point to opportunities for effective low cost government policies that can have meaningful positive effects on people s long term well being the last decade has been marked by a growing interest from governments the world over in using behavioural economics to inform policy decisions this is true of canada as well in this paper we discuss the increasingly important role behavioural economics plays in canadian public policy we first contextualize government policies that have incorporated insights from behavioural economics by outlining a collection of models of intertemporal choice we then present examples of public policy initiatives that are based upon findings in the field placing particular emphasis on canadian initiatives we also document future opportunities challenges and limitations

student responsiveness to earnings data in the college scorecard using the universe of sat score sends to colleges and the exact date on which these scores are sent we estimate how students responded to the release of the u s department of education s college scorecard in september 2015 we find that data on annual cost and graduation rate both of which were previously available did not impact the volume of score sends received by colleges by contrast we estimate that each 10 increase in reported earnings resulted in a 2 4 increase in score sends the impact is driven almost entirely by well resourced high schools and students we find little evidence that the count or composition of enrolled students changed as a result of the scorecard information shock with the exception of a slight increase in academic preparedness as measured by sat scores among enrollees at colleges with higher reported earnings jel i2 i23 i26 i28 l15

information school choice and academic achievement evidence from two experiments we examine a natural experiment and a field experiment that provided direct information on school test scores to lower income families in a public school choice plan receiving information significantly increases the fraction of parents choosing higher performing schools parents with high scoring alternatives nearby were more likely to choose nonguaranteed schools with higher test scores using random variation from each experiment we find that attending a higher scoring school increases student test scores the results imply that school choice will most effectively increase academic achievement for disadvantaged students when parents have easy access to test score information and good options from which to choose

the role of application assistance and information in college decisions results from the h r block fafsa experiment 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 we present results from a randomized field experiment in which low income individuals receiving tax preparation help were also offered immediate assistance and a streamlined process to complete the free application for federal student aid fafsa for themselves or their children treated participants were also provided with aid estimates that were compared against tuition cost amounts for nearby colleges the combined assistance and information treatment substantially increased fafsa submissions and ultimately the likelihood of college attendance persistence and aid receipt in particular high school seniors whose parents received the treatment were 8 percentage points more likely to have completed two years of college going from 28 to 36 during the first three years following the experiment families who received aid information but no assistance with the fafsa did not experience improved outcomes the findings suggest many other opportunities for using personal assistance to increase participation in programs that require filling out forms to become eligible jel codes i2 h4 j24 copyright 2012 oxford university press

the use and impact of business advice by smes in britain an empirical assessment using logit and ordered logit models this study assesses the effect of differences in types of client on the use and impact of business advice by smes in britain using new survey evidence from the cambridge esrc centre for business research survey of 1997 the survey covering over 2500 respondents is the largest and most definitive assessment available in britain moreover the survey allows an assessment of the full range of providers of external advice the private sector business associations and various public sector bodies as well as the fields of advice using multivariate logit models it is found that size of firm rate of growth and innovation appear to be the main variables influencing the likelihood of firms seeking external advice both from different sources and from different fields other variables which are investigated include age profitability skill levels manufacturer services and exporter nonexporter ordered logit models of the impact of the advice demonstrate that there are significant differences between client

determinants of college major choice identification using an information experiment this article studies the determinants of college major choice using an experimentally generated panel of beliefs obtained by providing students with information on the true population distribution of various major specific characteristics students logically revise their beliefs in response to the information and their subjective beliefs about future major choice are associated with beliefs about their own earnings and ability we estimate a rich model of college major choice using the panel of beliefs data while expected earnings and perceived ability are a significant determinant of major choice heterogeneous tastes are the dominant factor in the choice of major analyses that ignore the correlation in tastes with earnings expectations inflate the role of earnings in college major choices we conclude by computing the welfare gains from the information experiment and find positive average welfare gains

in defense of the nsf economics program abstract the nsf economics program funds basic research in economics across all its disparate fields its budget has experienced a long period of stagnation and decline with its real value in 2013 below that in 1980 and having declined by 50 percent as a percent of the total nsf budget the number of grants made by the program has also declined over time and its current budget is very small compared to that of many other funders of economic research over the years nsf supported research has supported many of the major intellectual developments in the discipline that have made important contributions to the study of public policy the public goods argument for government support of basic economic research is strong neither private firms foundations nor private donors are likely to engage in the comprehensive support of all forms of economic research if nsf were not to exist select universities with large endowments are more likely to have the ability to support general economic research in the abse

psychological frictions and the incomplete take up of social benefits evidence from an irs field experiment we address the role of psychological frictions in the incomplete take up of eitc benefits with an irs field experiment we specifically assess the influence of program confusion informational complexity and stigma by evaluating response to experimental mailings distributed to 35 050 tax filers who failed to claim 26 million despite an initial notice while the mere receipt of the mailing simplification and the heightened salience of benefits led to substantial additional claiming attempts to reduce perceived costs of stigma application and audits did not the study and accompanying surveys suggests that low program awareness understanding and informational complexity contribute to the puzzle of low take up jel c93 d03 h24 m38

creating value through mutual commitment to business network relationships a structural model of business relationship development in a business network context is formulated and tested on delta from the european international marketing and purchasing imp project the e

intended college attendance evidence from an experiment on college returns and costs abstract we conduct an information experiment about college returns and costs embedded within a representative survey of us household heads baseline perceptions of college costs and benefits are substantially biased with larger biases among lower income and non college households respondents are randomly exposed to objective information about average college returns or costs we find a significant impact of the returns experiment persisting in a follow up survey two months later intended college attendance expectations increase by about 0 2 of the standard deviation in the baseline likelihood and gaps by household income or parents education decline by 20 30 we find no impact of the cost information treatment further analysis supports the information s salience as opposed to information based updating as the main channel through which the returns intervention impacts intentions

the labor market returns to community college degrees diplomas and certificates this article provides one of the first rigorous estimations of the labor market returns to community college certificates and diplomas as well as estimations of the returns to the more commonly studied associate s degrees using administrative data from kentucky we estimate panel data models that control for differences among students in precollege earnings and educational aspirations associate s degrees and diplomas have quarterly earnings returns of nearly 2 400 for women and 1 500 for men compared with much smaller returns for certificates there is substantial heterogeneity in returns across fields of study degrees diplomas and for women certificates correspond with higher levels of employment

the effects of state mandated financial education on college financing behaviors students entering college have limited financial experience while making complex borrowing decisions this paper examines a policy lever that may improve these decisions high school personal finance graduation requirements we use a difference in difference strategy to determine their effects on financial aid decisions of incoming freshmen at 4 year institutions our results suggest financial education shifts students from high cost to low cost financing the requirements increase aid applications and acceptance of federal loans while decreasing the likelihood of holding credit card balances students from less affluent family backgrounds reduce their likelihoods of working and borrowers from more affluent backgrounds reduce private loan amounts

the new wave of regional innovation networks analysis characteristics and strategy today the number one priority for competitive advantage is innovation a new approach to regional business development has been pioneered in europe and the u s a this involves building a regional innovation infrastructure learning through networking has proven to be a successful approach in some of europe s more dynamic regional economics such as baden wurttemberg and emilia romagna this involves maximising the complete range of regional innovation assets the state of pennsylvania and other older industry centres are showing that such an approach is transferable from europe to the u s a the paper assesses knowledge transfer at the regional level and outlines the key elements for successful regional innovation networking practices the major finding s are that business networking is an effective way of increasing company turnover that not for profit organizations are excellent for setting up networks because they are trusted and that innovation networks are perhaps the most difficult thought requiring but important of the types of business network conceivable

optimal punishments with detection lags abstract in this note we characterize optimal two phase punishments in the presence of an n period detection lag i e when cheating on an implicit agreement can be kept secret for a certain time period two simple applications are also provided

comparison friction experimental evidence from medicare drug plans consumers need information to compare alternatives for markets to function efficiently recognizing this public policies often pair competition with easy access to comparative information the implicit assumption is that comparison friction the wedge between the availability of comparative information and consumers use of it is inconsequential because information is readily available and consumers will access this information and make effective choices we examine the extent of comparison friction in the market for medicare part d prescription drug plans in the united states in a randomized field experiment an intervention group received a letter with personalized cost information that information was readily available for free and widely advertised however this additional step providing the information rather than having consumers actively access it had an impact plan switching was 28 percent in the intervention group versus 17 percent in the comparison group and the intervention caused an average decline in predicted consumer cost of about 100 per year among letter recipients roughly 5 percent of the cost in the comparison group our results suggest that comparison friction can be large even when the cost of acquiring information is small and may be relevant for a wide range of public policies that incorporate consumer choice

a general equilibrium analysis of state and private colleges and access to higher education in the u s abstract we develop a general equilibrium model of the market for undergraduate higher education that captures the coexistence of public and private colleges the large degree of quality differentiation among them and the tuition and admission policies that emerge from their competition for students a quantitative version of the model matches well estimates of enrollment elasticities variation in need based and merit based institutional aid with respectively student income and ability and aggregate characteristics of u s higher education including college attendance in public and private schools tuition levels and the provision of federal aid predictions about the provision of federal aid and the distribution of students across colleges by ability and income match the empirical counterparts well we use the model to examine the consequences of federal and state aid policies a one third increase in the maximum federal aid increases college attendance by 6 of the initial college population most of the increase being in state colleges and mainly of poor students elite private colleges reduce institutional aid and use the net funding gain to spend more on educational inputs and to substitute some highly able poor students for less able rich students reductions in federal or state aid result in substantially reduced attendance mainly by poor students reductions of support to state colleges induce private colleges to increase enrollments modestly and improve in quality as demand shifts toward them

towards a theory of entrepreneurial teams abstract this article examines the role of entrepreneurial teams in processes of entrepreneurial discovery it addresses two main questions the first investigates the implications of economic theory for the possibility of team entrepreneurship because leading economic theories focus almost exclusively upon individual decision makers we propose a broader notion of entrepreneurship that includes enterprising teams as well as individuals we define entrepreneurship as a profit seeking problem solving process that takes place under conditions of structural uncertainty the second question examines the conditions that are conducive to joint entrepreneurial action and the formation of entrepreneurial teams we suggest that bounded structural uncertainty and perceived strong interdependence arising from common interest can jointly prime team entrepreneurship

networks in entrepreneurship the case of high technology firms the value of networks as an integral part of the explanation of entrepreneurial success is widely acknowledged however the network perspective does not specify the role of networks in the emergence and early growth of a venture we have distinguished three entrepreneurial processes in new venture development i e discovery of opportunities securing resources and obtaining legitimacy which are of importance for survival and performance this paper examines how these processes are influenced by strong and or weak ties and whether the degree of innovation incremental versus radical acts as a contingency factor in the way network ties support entrepreneurial processes in this explorative study three cases on high technology firms in the netherlands provide empirical material enabling us to develop a number of propositions on the network effect in particular the mix of strong and weak ties on the three entrepreneurial processes

does aid matter measuring the effect of student aid on college attendance and completion does student aid increase college attendance or simply subsidize costs for infra marginal students settling the question empirically is a challenge because aid is correlated with many characteristics that influence educational investment decisions a shift in financial aid policy that affects some youth but not others can provide an identifying source of variation in aid in 1982 congress eliminated the social security student benefit program which at its peak provided grants totaling 3 7 billion a year to one out of ten college students using the death of a parent as a proxy for social security beneficiary status i find that offering 1 000 1998 of grant aid increases educational attainment by about 0 16 years and the probability of attending college by four percentage points the elasticities of attendance and completed years of college with respect to schooling costs are 0 7 to 0 8 the evidence suggests that aid has a threshold effect a student who has crossed the hurdle of college entry with the assistance of aid is more likely to continue schooling later in life than one who has never attempted college this is consistent with a model in which there are fixed costs of college entry finally a cost benefit analysis indicates that the aid program examined by this paper was a cost effective use of government resources this abstract was borrowed from another version of this item

investment over the business cycle insights from college major choice this paper examines the relationship between individuals personal exposure to economic conditions and their investment choices in the context of human capital focusing on bachelor s degree recipients we find that birth cohorts exposed to higher unemployment rates during typical schooling years select majors that earn higher wages that have better employment prospects and that more often lead to work in a related field much of this switching behavior can be considered a rational response to di erences in particular majors labor market prospects during a recession however higher unemployment leads to other meaningful changes in the distribution of majors conditional on changes in lifetime expected earnings recessions encourage women to enter male dominated fields and students of both genders pursue more dicult majors such as stem fields these findings imply that the economic environment changes how students select majors possibly by encouraging them to consider a broader range of possible degree fields finally in the absence of this compensating behavior we estimate that the average estimated costs of graduating in a recession would be roughly ten percent larger jel e32 i23 j22 j24

investing in schooling in chile the role of information about financial aid for higher education we investigate the impacts of providing low income chilean adolescents with information about how to finance higher education and ask whether providing parents with the same information magnifies the effects on schooling outcomes we randomly assigned eighth graders and some parents to receive information about aid for higher education exposure to information raised college preparatory high school enrollment primary school attendance and financial aid knowledge with gains concentrated among medium and high grade students parental exposure to information did not significantly magnify these effects our results demonstrate that access to relevant information about financial aid affects important schooling choices long before tertiary education begins

dynamic r d competition with learning to account for the possibility that firms are unsure about the ease of innovation we formulate a differential game of r d competition with an unknown hazard rate we show as time passes with success firms become more pessimistic about eventual innovation reducing their r d investment and possibly exiting the race an increase in the number of competing firms tends to increase firms r d intensities for given beliefs but because beliefs evolve at different rates depending on the number of firms in the race time paths of r d investment intensity are not unambiguously ordered with respect to the number of competing firms

multifaceted aid for low income students and college outcomes evidence from north carolina we study the evolution of a campus based aid program for low income students that began with grant heavy financial aid and later added a suite of nonfinancial supports we find little to no evidence that program eligibility during the early years 2004 2006 in which students received additional institutional grant aid and few nonfinancial supports improved postsecondary progress performance or completion in contrast program eligible students in more recent cohorts 2007 2010 when the program supplemented grant heavy aid with an array of nonfinancial supports were more likely to meet credit accumulation benchmarks toward timely graduation and earned higher grade point averages than their barely ineligible counterparts jel i21 i23 i24 j08

the value of human and social capital investments for the business performance of startups we investigate the manifold posed question to what extent does investment in human and social capital besides the effect of talent enhance entrepreneurial performance we distinguish between three different performance measures survival profits and generated employment on the basis of the empirical analysis of a rich dutch longitudinal data set of firm founders we conclude that specific investments indeed affect the three performance measures substantially and significantly specific attention is paid to the unobserved talent bias moreover the effect of the emergence of so called knowledge industries is explored

take up and targeting experimental evidence from snap this paper develops a framework for evaluating the welfare impact of various interventions designed to increase take up of social safety net programs in the presence of potential behavioral biases we calibrate the key parameters using a randomized field experiment in which 30 000 elderly individuals not enrolled in but likely eligible for the supplemental nutrition assistance program snap are either provided with information that they are likely eligible provided with this information and also offered assistance in applying or are in a status quo control group only 6 percent of the control group enrolls in snap over the next 9 months compared to 11 percent of the information only group and 18 percent of the information plus assistance group the individuals who apply or enroll in response to either intervention receive lower benefits and are less sick than the average enrollee in the control group the results are consistent with the existence of optimization frictions that are greater for needier individuals suggesting that the poor targeting properties of the interventions reduce their welfare gains

equilibrium and optimal size of a research joint venture in an oligopoly with spillovers this paper analyzes a simple oligopoly model with information spillovers firms spend on r d to affect their costs of production the main finding is that depending on the magnitude of the spillover the market may not provide enough incentives for the optimum degree of cooperation to take place it is shown that the equilibrium size of a research joint venture is usually less than the optimum size which requires all firms to participate in the research joint venture the policy implications of this result are that there should be encouragement for firms competing in high technology industries to form industry wide cooperative agreements copyright 1995 by blackwell publishing ltd

when financial aid is scarce the challenge of allocating college aid where it is needed most abstract inequality in college completion by income is a persistent problem often addressed through financial aid to lower income students prior research has found mixed effects of financial aid but research designs have not identified effects for the poorest students who may benefit the most this study exploits an eligibility cutoff induced by first come first served allocation of funds in the state of wisconsin the analysis focuses on two year technical colleges where there was a large funding shortage affecting students at all income levels i find positive effects of grant aid in reducing dropout and supporting degree completion with larger positive effects for the poorest students

the economics of formal business networks abstract this paper analyzes the under researched issue of formal business networks comprising voluntary groupings of entrepreneurs who share knowledge and experiences between themselves economic analysis is used to show how formal business networks which enable entrepreneurs to share good and bad practice can improve efficiency and social welfare the paper also derives conditions for the existence and equilibrium size of formal business networks two principles of network design are proposed to promote their stability and to avoid their collapse

credit constraints and demand for higher education evidence from financial deregulation abstract we use staggered banking deregulation across states in the united states to examine the impact of the resulting increased credit supply on college enrollment from the 1970s to the early 1990s our research design produces estimates that are not confounded by wealth effects due to changes in income or housing wealth we find that lifting banking restrictions raises college enrollment by about 2 6 percentage points 4 9 we rule out alternative interpretations by examining results for different income groups and bankrupt households we also find similar effects for two year or four year college completion and supporting evidence in household educational borrowing

trends in quality adjusted skill premia in the united states 1960 2000 this paper presents new evidence that increases in college enrollment lead to a decline in the average quality of college graduates between 1960 and 2000 resulting in a decrease of 8 percentage points in the college premium the standard demand and supply framework katz and murphy 1992 card and lemieux 2001 can qualitatively account for the trend in the college and age premia over this period but the quantitative adjustments that need to be made to account for changes in quality are substantial furthermore the standard interpretation of the supply effect can be misleading if the quality of college workers is not controlled for to illustrate the importance of these adjustments we reanalyze the problem studied in card and lemieux 2001 who observe that the rise in the college premium in the 1980s occurred mainly for young workers and attribute this to the differential behavior of the supply of skill between the young and the old our results show that changes in quality are as important as changes in prices to explain the phenomenon they document

information and college access evidence from a randomized field experiment information and college access high school students from disadvantaged high schools in toronto were invited to take two surveys about three weeks apart half of the students taking the first survey were also shown a three minute video about the benefits of post secondary education pse and were invited to try out a financial aid calculator most students perceived returns to pse were high even among those not expecting to continue those exposed to the video especially those initially unsure about their own educational attainment reported significantly higher expected returns and lower concerns about costs and expressed a greater likelihood of pse attainment

the community dynamics of entrepreneurship the birth of the american film industry 1895 1929 the study of entrepreneurship has traditionally focused on the founders of new organizations especially those that emerge as leaders in the creation of new industries much of this work follows what gartner 1989 called the traits approach studies of this type posit a causal link between the founding and success of new organizations and the personal attributes of the entrepreneurs however more recent research has documented the many ways in which successful entrepreneurship requires more than just the right person a multitude of factors operating at both the organizational and evironmental levels of analysis also affect the success of entrepreneurial efforts examples include technological change shane 1996 changes in sources of firm capital cable and shane 1997 changes in strategic alliances eisenhardt and schoonhoven 1996 personal networks ostgaard and birley 1996 national environments shane and kolvereid 1995 location choice stearns carter reynolds and williams 1995 and national culture shane 1992

a panel study of firm growth among smes in networks an underlying assumption in sme literature as well as among policymakers is that networks are good per se especially for smes through accessing and utilising external resources in the network the sme can overcome some of the assumed disadvantages of limited size thus networking is assumed to enhance small firm performance and thereby small firm growth this article investigates this assumption analysis of panel data ascertains that a substantial number of smes are actively networking and that the level of networking has been maintained over a five year period in spite of this there is no evidence of associated short term benefits such as growth in employment or growth in total sales resulting from the networking activities the analyses suggest however that networking is associated with high growth in the geographic extension of markets which suggests that networking sustains long term objectives of the firms

integrity versus access the effect of federal financial aid availability on postsecondary enrollment abstract it is generally believed that access to financial aid will increase the likelihood that students will attend and graduate from college there is a surprising lack of research however on the consequences when postsecondary institutions lose eligibility to disburse financial aid this paper provides among the first causal estimates of institution level financial aid funding loss on enrollment and composition of student bodies i implement a dynamic regression discontinuity design using a multi year rule that restricts institutions eligibility to offer federal aid such as pell grants and subsidized loans when alumni s loan repayment rates are below allowed thresholds results suggest that financial aid loss discourages enrollment at for profit institutions and institutions that offer programs of two years or less the decline in enrollment appears to be driven by fewer new enrollees particularly at for profit colleges i find less conclusive evidence that ineligibility to disburse federal financial aid substantially alters student body composition this research is particularly relevant considering recently proposed federal rulemaking that will further limit the number of institutions eligible to disburse financial aid based on additional student loan debt repayment requirements restrictions such as these are intended to protect students and the integrity of federal aid programs but may also have implications for access to higher education

perceptions of institutional quality evidence of limited attention to higher education rankings abstract rankings of colleges and universities provide information about quality and potentially affect where prospective students send applications for admission we find evidence of limited attention to the popular u s news and world report rankings of america s best colleges we estimate that applications discontinuously drop by 2 6 when the rank moves from inside the top 50 to outside the top 50 whereas there is no evidence of a corresponding discontinuous drop in institutional quality notably the ranking of 50 corresponds to the first page cutoff of the printed u s news guides the choice of college is typically a one time decision with potentially large repercussions so students limited attention to rankings likely represents an irrational bias that negatively affects welfare

weighting recent performance to improve college and labor market outcomes abstract there is a great deal of policy interest in reducing college dropout rates increasing graduation rates and improving labor market outcomes to this end individual colleges and state university systems use high school grade point averages and class rankings in an effort to offer admission and scholarships to students who are most likely to achieve long run success however a significant fraction of students exhibit steep positive or negative performance trends during high school this study shows that academic performance in later grades is given no greater weight in admissions but is the best predictor of college and labor market outcomes greatly exceeding prior grades and entrance exam scores placing greater weight on later grades and extending application deadlines to allow the consideration of 12th grade performance is shown to significantly alter which students are admitted to college and to improve their expected long run outcomes importantly weighting recent performance does not appear to affect college diversity evidence is presented that the predictive power of later grades is driven primarily by students who experience large negative performance trajectories during high school

estimating the effect of financial aid offers on college enrollment a regression discontinuity approach an important problem faced by colleges and universities that of evaluating the effect of their financial aid offers on student enrollment decisions is complicated by the likely endogeneity of the aid offer variable in a student enrollment equation this article shows how discontinuities in an east coast college s aid assignment rule can be exploited to obtain credible estimates of the aid effect without having to rely on arbitrary exclusion restrictions and functional form assumptions semiparametric estimates based on a regression discontinuity rd approach affirm the importance of financial aid as an effective instrument in competing with other colleges for students

behavioral economics and public policy a pragmatic perspective the debate about behavioral economics the incorporation of insights from psychology into economics is often framed as a question about the foundational assumptions of economic models this paper presents a more pragmatic perspective on behavioral economics that focuses on its value for improving empirical predictions and policy decisions i discuss three ways in which behavioral economics can contribute to public policy by oering new policy tools improving predictions about the eects

university differences in the graduation of minorities in stem fields evidence from california the low number of college graduates with science degrees particularly among underrepresented minorities is of growing concern we examine differences across universities in graduating students in different fields using student level data on the university of california system during a period in which racial preferences were in place we show significant sorting into majors based on academic preparation with science majors at each campus having on average stronger credentials than their non science counterparts students with relatively weaker academic preparation are significantly more likely to leave the sciences and take longer to graduate at each campus we show the vast majority of minority students would be more likely to graduate with a science degree and graduate in less time had they attended a lower ranked university similar results do not apply for non minority students

networks and local environmental characteristics in the survival of new firms this study seeks firstly to clarify which networks at start up situation and early in life influence the survival of new firms secondly the study examines regional differences in the success of new firms the subjects were firms which had closed down during their fourth to sixth year of operations and they were compared with firms continuing in business the results indicate firstly that it is networks internal to firm that create competitive advantage innovation and efficiency secondly management based on working in groups was emphasized in the firms that continued in business in a typical family enterprise ownership management and family are united in a single entity in other types of firms networks are seen as participating in the strategic management of the firm thirdly close downs were often caused by uncontrolled risks a firm which fails after a successful start up often tends to grow rapidly in the beginning leaning on its product idea but this rate of growth is too high from the viewpoint of the financing and the management of the firm in firms which closed the growth objectives were too ambitions compared with the resources of the entrepreneur

not whether but where pell grants and college choices abstract pell grants are the largest financial aid vehicle in the united states and yet their role in shaping students college choices is not clear drawing on the enrollment decisions of four cohorts of tennessee high school graduates and quasi experimental pell eligibility derived from federal formulas we find little evidence that marginal pell eligibility affects whether or where students enroll in college inframarginal estimates suggest that students sort into colleges with 11 6 cents higher tuition per dollar of pell aid although other measures of college quality do not significantly improve over the counterfactual an investigation into mechanisms that might be muting student responses to pell favors the application process itself over grant size or institutional aid flexibility

information frictions and access to the paycheck protection program the paycheck protection program ppp extended 669 billion dollars of forgivable loans in an unprecedented effort to support small businesses affected by the covid 19 crisis this paper provides evidence that information frictions and the first come first served design of the ppp program skewed its resources towards larger firms and may have permanently reduced its effectiveness using new daily survey data on small businesses in the u s we show that the smallest businesses were less aware of the ppp and less likely to apply if they did apply the smallest businesses applied later faced longer processing times and were less likely to have their application approved these frictions may have mattered as businesses that received aid report fewer layoffs higher employment and improved expectations about the future

priceless the nonpecuniary benefits of schooling copyright 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 by the american economic association permission to make digital or hard copies of part or all of american economic association publications for personal or classroom use is granted without fee provided that copies are not distributed for profit or direct commercial advantage and that copies show this notice on the first page or initial screen of a display along with the full citation including the name of the author copyrights for components of this work owned by others than aea must be honored abstracting with credit is permitted the author has the right to republish post on servers redistribute to lists and use any component of this work in other works for others to do so requires prior specific permission and or a fee permissions may be requested from the american economic association administrative office by going to the contact us form and choosing copyright permissions request from the menu copyright 2016 aea

education earnings and the canadian g i bill canadian second world war veterans benefited from an extensive educational pro gram similar to the u s g i bill because of differences in military enlistment rates how ever a much lower fraction of quebec men were eligible for these benefits than men from other provinces building on this fact we analyse inter cohort patterns of education and earnings for english speaking men from ontario using french speaking men from quebec as a control group we find that the instrumental variables estimates of the return to school ing are typically as big or bigger than the corresponding ols estimates jel classification j24 i21

reducing income inequality in educational attainment experimental evidence on the impact of financial aid on college completion income inequality in educational attainment is a long standing concern and disparities in college completion have grown over time need based financial aid is commonly used to promote equality in college outcomes but its effectiveness has not been established and some are calling it into question a randomized experiment is used to estimate the impact of a private need based grant program on college persistence and degree completion among students from low income families attending 13 public universities across wisconsin results indicate that offering students additional grant aid increases the odds of bachelor s degree attainment over four years helping to diminish income inequality in higher education

knowing when to quit default choices demographics and fraud we study defaults in a novel setting where the optimal choice is clear the decision to escape from fraud a government lawsuit created a natural experiment whereby some consumers enrolled in a fraudulent subscription programme were cancelled by default while others had to cancel actively we find that cancelling subscriptions by default increased cancellations to 99 8 63 4 percentage points more than requiring active cancellation we also find that consumers residing in poorer less educated census blocks were more likely than average to cancel prior to the lawsuit but were less likely to actively cancel when notified they could do so