|Equation||(# students receiving a scholarship) x (Q: % earning a higher education degree due to the intervention) x ($ additional lifetime earnings from a 4-year degree vs. high school completion) x (Causation factor of a college degree on earnings)|
|Explanation||This metric estimates the impact of education scholarships on the likelihood of receiving a bachelor’s degree, leading to increased lifetime earnings.
Number of students receiving scholarships: Reported by program.
Q: Percentage earning a higher education degree due to the intervention: [0.14]. This is estimated by Constellation Fund staff using the following formula:
In this formula, ES [0.25] is the effect size from a meta-analysis of higher education scholarship programs on the rate of graduation at 4-year higher education institutions. The effect size is measured in percent increases. The base percentage [0.57] is the average graduation rate at 4-year postsecondary institutions estimated using data from the National Student Clearinghouse (2016).
Additional lifetime earnings from a 4-year degree vs. high school completion: [$465,900]. This is computed using ACS data (U.S. Census Bureau, 2016). These benefits are already discounted to present value.
Causation factor of college on earnings: [0.46]. This is the percentage of observed earnings gains caused by a four-year college degree. This factor measures the degree to which the observed difference in earnings between types of graduates and non-graduates is causal (WSIPP, 2019).
|References||Bartik, T. J., Hershbein, B., & Lachowska, M. (2019). The Effects of the Kalamazoo Promise Scholarship on College Enrollment and Completion. Journal of Human Resources, 0416-7824R4. https://doi.org/10.3368/jhr.56.1.0416-7824r5
Benjamin L. Castleman, & Long, B. T. (2016). Looking Beyond Enrollment : The Causal Effect Of Need-Based Grants On College Access, Persistence, And Graduation. Benjamin L . Castleman Harvard Graduate School of Education Bridget Terry Long Harvard Graduate School of Education and NBER. Journal of Labor Economics, 34(4), 1023–1073.
Cohodes, S. R., & Goodman, J. S. (2014). Merit Aid, College Quality, and College Completion: Massachusetts’ Adams Scholarship as an In-Kind Subsidy. American Economic Journal: Applied Economics, 6(4), 251–285. https://doi.org/10.1257/app.6.4.251
Goldrick-Rab, S., Kelchen, R., Harris, D. N., & Benson, J. (2016). Reducing Income Inequality in Educational Attainment: Experimental Evidence on the Impact of Financial Aid on College Completion. American Journal of Sociology, 121(6), 1762–1817. https://doi.org/10.1086/685442
National Student Clearinghouse (2016). National College Progression Rates. Retrieved from: https://nscresearchcenter.org/hsbenchmarks2016/
Scott-Clayton, J. (2009). On Money and Motivation: A Quasi-Experimental Analysis of Financial Incentives for College Achievement. 60. http://files/1612/Scott-Clayton – On Money and Motivation A Quasi-Experimental Anal.pdf
U.S. Census Bureau. (2016). American Community Survey 5-year estimates – public use microdata sample, 2012-2016. Generated using Public Use Microdata Area (PUMA) in the Seven-county Twin Cities Metropolitan Area.
Washington State Institute for Public Policy. (2019). Benefit-cost technical documentation. Olympia, WA: Author. Retrieved from: http://www.wsipp.wa.gov/TechnicalDocumentation/WsippBenefitCostTechnicalDocumentation.pdf