Financial Aid:

In this article, Bridget Terry Long and Erin Riley argue that in recent years, U.S. financial aid policy has shifted its emphasis from expanding college access for low-income students toward defraying the costs for middle- and upper-income families. They explain how loans, merit-based aid, and education tax breaks are increasingly replacing need-based aid and discuss how the declining role of grants may disproportionately disadvantage students already underrepresented in higher education. They document the rise in students’ unmet financial needs over the past decade, showing that low-income students and students of color are especially likely to face substantial unmet need even after taking into account all available grants and loans, as well as family contributions. In response to these trends, the authors call for a greater emphasis on need-based aid, especially grants, to reduce the role of cost as a barrier to college access.

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Bridget Terry Long is an associate professor of education and economics at the Harvard Graduate School of Education. She studies the transition from secondary to higher education and beyond, specifically college access and choice, the determination of college student outcomes, and the behavior of postsecondary institutions. She has published articles in the Review of Economics and Statistics, the Journal of Human Resources, and the Journal of Econometrics, among others. Long is also a faculty research associate of the National Bureau of Economic Research, and in 2006 she served as a visiting scholar with the New England Public Policy Center at the Boston Federal Reserve Bank. In July 2005, the Chronicle of Higher Education featured her as one of the “New Voices” in higher education.

Erin Riley is an independent research consultant whose work focuses on education policy and postsecondary institutions. She recently worked on an analysis of the impact of financial aid and state policies focused on improving academic preparation. She has coauthored (with B. T. Long) “Sending Signals to Students: The Role of Early Placement Testing in Improving Academic Preparation” (forthcoming in a volume on K–16 policies and programs) and “The Demand Side of Student Loans: The Changing Face of Borrowers” (forthcoming from the American Economic Institute). Riley previously worked for Eduventures, a private education research and consulting firm.