More Knowledge Needed Of College Finance Incentives to Increase Student Completion

  I am attending the American Education Finance Association Meeting where finance scholars met to discuss what is needed in future research. The consensus is that we know a lot more about student financial aid than about what performance funding incentives for colleges that would work to spur student persistence and completion. Colleges are mostly paid on full time student counts, or like Ca. community colleges for the full time equivalent of the number enrolled after 3 weeks of a class. This allows colleges to churn students and still be fiancially viable. As long as there is a body in  a seat, student persistence and completion are not needed to collect full FTE from the state.

 Scholars agree most past state incentives for student completion have been too small or badly designed. We know little about the micro economics of specific broad access colleges, and how to design state aid formulas that would enhance completion. There are thousands of colleges and many different college missions. These topics need much more research and experimentation, but it is not clear who will fund or do this work.

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