The Impact of State Appropriations and Grants on Access to Higher Education and Outmigration

Abstract

The question of how states can best use financial policy to achieve their goals is very important for many higher education stakeholders. In this study, the authors use panel data for all 50 states over a 20-year period to examine how state appropriations, need-based grants, and merit-based grants affect student enrollment in college and whether students migrate to other states for their postsecondary education. We find that increases within states in both appropriations and merit-based grants, but not need-based grants, lead to gains in postsecondary enrollment rates, and that merit-based grants are most effective at reducing outmigration for postsecondary education.