Association for Public Policy Analysis & Management

ACHAB (Affording College with the Help of Asset Building) is a random assignment demonstration funded by the European Union to test the effectiveness of an innovative form of financial aid, in which families become active participants by saving small amounts of money (€5 and €50 a month for up to six years). Families are allowed to deposit a total of up to €2,000, and then the savings are supplemented with a 4:1 matching multiplier from a private donor. Families who saved the maximum of €2,000 would receive a maximum grant of €8,000, thus giving them a total of €10,000 to pay for university-related expenses. We report ITT (intention-to-treat) estimates, that is, estimates that show the effect of being offered a benefit rather than actually receiving it.When impacts are assumed to be homogeneous across beneficiaries, the estimates provide a simple answer: in the case of ACHAB, the average impact – that is, the average difference between the treated and the control students, is about 9 percentage points in the case of university enrollment. A different story emerges when we take into account heterogeneity of impacts. The major source of heterogeneity is the type of high school track: academic, technical, vocational. For vocational students, participation in ACHAB has a large (20 percentage points) and significant effect on the probability of enrolling in a university, whereas those on the academic track lag behind at 9 percentage points, and technical school students fall below a non-significant 5 percentage points effect. Among vocational school students, ACHAB has an even stronger effect on the other three outcomes: 33 percentage points taking an exam during the first semester of university, 35 percentage points for taking two exams during the first year and 27 percentage points in the case of enrollment for the second year of any university. In addition to this quantitative evidence, we ran a large number of in depth-interviwes with several stakeholders, in order to attempt to decipher the mechanisms behind the success obtained by the ACHAB treatment.