Seeking STEM: The Causal Impact of Need-Based Grant Aid on Undergraduates’ Field of Study

ABSTRACT

Increasing the number of science, technology, engineering, and mathematics (STEM) degrees is a national priority and one way to promote the socioeconomic mobility of students from low-income families. Prior research examining why students do not complete STEM majors often points to students’ lack of academic preparation, preferences for non-STEM majors, or lack of information about the value of STEM. This paper uses a randomized experiment to investigate an alternative explanation, that some students lack the financial resources to succeed in demanding majors. In a control group of university students from low-income families, 18.6% of students had declared a STEM major by their third year of college. In a treatment group who were offered additional need-based grant aid upon entering college, 26.5% of students declared a STEM major. Among students who had graduated within six years after entering college, 12.2% of control group graduates had earned a STEM degree compared to 20.2% of treatment group students. Need-based grants thus appear to have the potential to increase the share of low-income students studying and earning degrees in STEM.

KEYWORDS:

• STEM
• financial aid
• low-income
• Wisconsin

Acknowledgments

The authors thank Sara Goldrick-Rab, Peter Kinsley, Alison Bowman, and the Wisconsin Scholars Longitudinal Study research team for advice and support. We also thank David Bills, Harriet Nembhard, and participants at the 2018 Institute for Higher Education Law and Governance Higher Education Finance Roundtable for constructive feedback. We thank Graham Miller and the University of Iowa Old Gold Fellowship for research assistance and support. The Wisconsin Scholars Longitudinal Study was conducted in partnership with the Fund for Wisconsin Scholars, the Higher Educational Aids Board, the University of Wisconsin System, and the Wisconsin Technical College System under the direction of Dr. Sara Goldrick-Rab. Additional data was provided by the Wisconsin Department of Public Instruction and the Higher Educational Aids Board under a data sharing agreement with the RAND Corporation. All errors are those of the authors alone. Authors appear in alphabetical order. This research is not related to Drew M. Anderson’s work as an economist at Amazon.

Disclosure statement

The study was funded by The Bill and Melinda Gates Foundation, Great Lakes Higher Education Guaranty Corporation, Institute for Research on Poverty, Spencer Foundation, William T. Grant Foundation, Center for the Advancement of Postsecondary Education, and an anonymous donor.