Estimating the Effect of State Investment in Higher Education on College Completion

Abstract

Higher education has long been lauded as a vehicle for improved employment opportunity and economic stability. For today’s generation of students - one that is more economically and racially diverse than those before - the promise of a better future through pursuit of a postsecondary degree seems more unattainable as state funding cuts, steep tuition increases, and economic shocks threaten opportunities for accessible and affordable higher education. Using finance and completion data from the Delta Cost Project dataset between 2000 and 2015, the current study estimates the effect of state investment in higher education on college completion. The results show a positive relationship between state investment in higher education and college completion among students enrolled at public colleges and universities. The magnitude of these estimates are small, yet statistically significant.