Association for Public Policy Analysis & Management

College access and choice in the United States is closely linked to a student’s socioeconomic background. In recent decades, the gap in college attendance and completion by income level has grown (Bailey & Dynarski, 2011).

While a number of factors contribute to these trends, research over the past decade shows that complexities in applying for financial aid create barriers to accessing aid (Dynarski & Scott-Clayton, 2008, 2006). Estimates suggest nearly 2 million students annually who might be eligible for the federal Pell grant never submit a FAFSA (Kantrowitz, 2009). By reducing barriers in the financial aid process, previous studies demonstrate that professional assistance completing the FAFSA (Bettinger et al., 2012) and sending text message reminders about re-filing the FAFSA (Castleman & Page, in press) increase college enrollment and persistence.

While recent efforts focus on eliminating the FAFSA as a barrier to college access, roughly 250 selective colleges require an additional application for institutional aid. The CSS/Financial Aid PROFILE, the most common form, is longer than the FAFSA, contains questions specific to each college, and uses a different methodology to compute financial need. The PROFILE allows institutions to allocate institutional aid to students who need it the most, as measured by the form. However, adopting the PROFILE may create an additional barrier to college entry. Failing to file the PROFILE can cause students to miss sources of financial aid, leading to a decrease in enrollment among low-income students. 

In this paper, we first consider the impact of the PROFILE on how colleges award institutional funds and then examine the potentially unintended consequence of deterring low-income students from enrolling. Specifically, we examine whether there are changes in the share of students receiving aid, the share of institutional aid allocated based on need vs. merit, and the share of Pell grant recipients enrolled. Leveraging the adoption of the PROFILE over time, we will use a difference-in-differences design to estimate the PROFILE’s impact on college aid policy and access.

Our sample includes selective colleges, classified by Barron’s, over two decades (1995-2015). Data on PROFILE adoption come from the College Board (2016), and data on Pell enrollment and institutional aid policy come from the U.S. Department of Education’s Office of Postsecondary Education and the National Center for Education Statistics’ Integrated Postsecondary Education Data System. We also draw on administrative data from one college to examine the allocation of institutional aid under the PROFILE. We are finalizing the College Board data license and expect to have the data set completed and analysis begun by the summer.

To our knowledge, this study will provide the first estimates of how institutional financial aid forms affect the opportunities that low-income students have to attend selective colleges. Our results could inform interventions designed to encourage low-income students admitted to a selective college to complete the form, as well as lead institutions currently using the PROFILE to simplify their financial aid application process.