School Choice & Charters

Ga. Scholarship Keeps Students In State

By John Gehring — January 31, 2001 3 min read
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Georgia’s hope Scholarship program, which provides up to $3,000 a year in college aid to high school students who graduate with a B average, has enticed top-notch students to choose to attend in-state colleges and universities in greater numbers than ever before, a study concludes.

The study, conducted by two economists and a graduate researcher at the University of Georgia, found that the 7-year-old program’s broadest impact has been on influencing where students choose to go to college—rather than on widening access to postsecondary education.

“If your goal is to induce more people to go to college, this is probably not the scholarship plan to adopt,” said Christopher Cornwell, an associate professor of economics and the study’s co-author. “It is not clear the scholarship caused people to go to college who wouldn’t have otherwise.”

For More Information

Read the report, “The Enrollment Effects of Merit-Based Financial Aid: Evidence from Georgia’s HOPE Scholarship,” (requires Adobe’s Acrobat Reader), from the Terry College of Business.

Seventy-six percent of Georgia high school students with combined SAT scores greater than 1500, out of a possible 1600, now attend college in state, compared with just 23 percent in 1992, the researchers conclude in “The Enrollment Effects of Merit-Based Financial Aid: Evidence From Georgia’s HOPE Scholarship.”

Georgia’s lottery-funded program, which has been copied in at least a dozen other states and served as the basis for President Clinton’s federal HOPE tuition tax credit, has distributed a total of more than $1 billion to more than 500,000 students since its inception in 1993.

Mr. Cornwell and David B. Mustard, an assistant professor of economics at the university’s college of business, found that the Helping Outstanding Pupils Educationally Scholarship has prompted an 11 percent increase in first-time freshman enrollment, mostly at four-year colleges and universities.

The two authors, along with researcher Deepa Sridhar, conclude the scholarship program has had a significant impact on African-American enrollment at Georgia’s four-year schools. From 1993 to 1998, 24 percent more African-American students enrolled at a state college or university, their research shows.

Even at more expensive private, four-year colleges, black enrollment from Georgia high schools increased by 12 percent, the study found. There was a 20 percent gain for all Georgia high school students at private, four-year colleges.

The scholarships reward students, regardless of income, who maintain at least a B average in high school with full tuition, mandatory student fees, and a book allowance at the state’s public colleges and universities. Students who attend private colleges receive $3,000 toward their tuition.

The study draws upon statistics from the Southern Regional Education Board, an Atlanta-based organization that works to improve school achievement in Southern states, and contrasts enrollment rates in Georgia with those in bordering states that enrolled the most Georgia high school graduates.

After the HOPE program began, the study shows, 18 percent fewer Georgia students enrolled in those colleges and universities. Overall, at schools throughout the 16-state SREB region, Georgia students’ out-of-state enrollment fell 7.5 percent in the same period.

About two-thirds of students lose their HOPE scholarships while in college because they fail to maintain a B average. But the researchers, whose work was financed by the National Science Foundation, say most of those retention problems occur at two-year community and technical colleges.

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A version of this article appeared in the January 31, 2001 edition of Education Week as Ga. Scholarship Keeps Students In State

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