High school students at public schools in Kalamazoo, Michigan, get a pretty sweet deal: if they graduate, they are eligible for the Kalamazoo Promise, a scholarship that covers up to 100 percent of tuition for any public postsecondary institution in the state of Michigan. A team of economists wanted to explore whether this type of scholarship could increase the number of students who enroll in a university or community college, as well as whether it would impact postsecondary graduation rates. The results of this study, conducted by Timothy J. Bartik, Brad Hershbein, and Marta Lachowska, will appear in a forthcoming issue of the Journal of Human Resources. We spoke with the authors about their research process and the origins of their study. To learn more, read the full Journal of Human Resources preprint article, “The Effects of the Kalamazoo Promise Scholarship on College Enrollment and Completion,” freely available until the end of May.
Tell us about the history of the Kalamazoo Promise scholarship—how did it come about, what is the nature of this scholarship, and what initial questions did you have about it?
The Kalamazoo Promise was initiated in 2005 in a mid-sized, urban school district that had gradually been losing enrollment, but still retained many middle-class as well as low-income students, and in a community that had suffered recent job cutbacks, but still had many college-educated workers. The Promise came about through discussions between the Kalamazoo Public Schools superintendent and anonymous private donors about how to revitalize the community and the school district. The solution? A “simple” gift: any graduate who had lived and attended school in the district long enough could receive a generous scholarship to any Michigan public university or community college. The intent was to grow the local economy and school district by attracting families to the community and boosting students’ educational attainment and—presumably—their local job opportunities. Our initial question, addressed in prior research (Bartik, Eberts, and Huang 2010; Hershbein 2013), was the impact of the Kalamazoo Promise on district enrollment. Our current paper addresses whether the Promise succeeded in increasing educational attainment.
What is one takeaway from your article that you’d like to communicate to readers outside of the economics community?
The Kalamazoo Promise program, which is one specific design of a “free-tuition” program, worked! The program increased the attainment of a post-secondary credential by one-third. If one compares the predicted lifetime increase in earnings from this additional educational attainment with the Promise’s scholarship costs, the program’s rate of return is over 11 percent.
Why did it make sense to publish in the Journal of Human Resources?
The Journal of Human Resources is a top journal in empirical microeconomics and has published numerous articles on the effects of scholarship programs. Therefore, it felt like a natural fit for us. In addition to being well-regarded and influential, it also has a reputation for being a well-run journal.
Will you continue to pursue similar questions, or will you take your research in another direction?
Absolutely! There are relatively few studies of the long-term impacts of college scholarships on outcomes beyond education, such as employment, earnings, or financial health. Two prominent examples of such studies are Judy Scott-Clayton and Basit Zafar’s study of the West Virginia Promise and Bettinger et al’s study of the Cal Grant program in California. But the first of these is a merit scholarship and the second is need-based, and both are state programs; to date, there are no completed studies of workforce impacts of universal, place-based scholarships, even as these have continued to proliferate. With funding from the Strada Education Network, we and teams of other researchers are studying workforce impacts of the Kalamazoo Promise, the Pittsburgh Promise, Knox Achieves (the predecessor of the Tennessee Promise), and the Denver Scholarship Foundation. We expect to have preliminary results presented at conferences later this year, so stay tuned!
If a community is considering implementing a place-based scholarship like the Kalamazoo Promise, what factors should be considered to ensure they achieve the desired results?
This is a great question. Place-based college scholarships vary considerably in both their goals and their parameters and these two factors are not always aligned. Our paper demonstrates that a universal-access program can yield sizable increases in college completion, although it may not be the cost-minimizing approach to doing so. On the other hand, as we discuss in the paper, place-based college scholarships often have other goals besides just increasing educational attainments, such as strengthening K-12 achievement and local workforce and economic development. From our paper and related analyses, we’ve learned a few lessons that other communities should keep in mind:
- Simplicity generally leads to greater take-up. It’s often tempting to impose significant merit or financial need criteria to limit costs or reward “good students,” but the research doesn’t back this up as an effective strategy. Universal scholarships in communities with high financial need can provide simplicity while reducing the likelihood that scholarships subsidize relatively wealthy students. (This is one of the reasons place-based scholarships may be more compelling than statewide ones.)
- Money alone does not fix all problems. Even with one of the most generous scholarships in the country, only about half of Kalamazoo Promise students complete a credential within the ten years over which they can use the scholarship (and less within the first six years). Less generous scholarships often produce even smaller impacts. The Kalamazoo Promise, other scholarship programs, and even colleges have increasingly turned to provide additional supports, such as college coaching and navigators, to help students succeed. These supports have shown potential in several contexts, although we know relatively little about how effective these additional supports are with and without scholarships for tuition.
- To measure effectiveness, good data are imperative. We used National Student Clearinghouse data to measure postsecondary outcomes for our paper, but as more states continue to develop longitudinal data systems that track students from K-12 into college and beyond, it will be possible to create better estimates and examine additional outcomes, such as credit attainment, earnings, or use of social safety net programs. Currently, obtaining these data for evaluations is challenging even for the most successful and well-connected researchers, and often nearly impossible for local communities. States should make it easier for these data to be used for research purposes while protecting student confidentiality.
Timothy J. Bartik’s research focuses on how broad-based prosperity can be advanced through better local labor market policies. This includes both policies affecting labor demand, such as state and local economic development policies, and policies affecting labor supply, such as place-based scholarships. Bartik is co-editor of Economic Development Quarterly, the only journal focused on local economic development in the United States. Bartik received both his PhD and his MS in economics from the University of Wisconsin–Madison in 1982. He earned a BA from Yale University in political philosophy in 1975. Prior to joining the Upjohn Institute in 1989, he was an assistant professor of economics at Vanderbilt University.
Brad Hershbein is an economist at the W. E. Upjohn Institute for Employment Research, a labor studies research organization in Kalamazoo, Michigan, and a non-resident fellow in Economic Studies at the Brookings Institution. He also serves as the Institute’s director of information and communications services. His fields of interest focus on labor economics, demography, and economics of education, and especially the intersection of the three. His work has appeared in Journal of Policy Analysis and Management, American Economic Journal: Applied Economics, and American Economic Review. He earned his BA in economics from Harvard College, and his PhD, also in economics, from the University of Michigan.
Marta Lachowska completed her Ph.D. in economics at Stockholm University in 2010. Lachowska has research interests in labor economics, economics of social insurance, and economics of education. Her work has been published in the American Economic Journal: Economic Policy, Journal of Human Resources, Labour Economics, and Oxford Economic Papers, among others. She has been the PI or co-PI of several investigator-initiated grants, including projects funded by the U.S. Department of Labor, the William T. Grant Foundation, and the Washington Center for Equitable Growth.