Do Grants Improve the Outcomes of University Students in a Context with High Dropout Rates? Evidence from a Matching Approach.

We investigate whether grants improve the academic outcomes of students from socioeconomicallydisadvantaged families and, by this way, contribute to reducing inequalitiesof educational opportunities. Differently from most previous studies, we focus on Italy, acontext with high dropout rates and prolonged duration of higher education studies. Toestimate the causal effect of the grant we followed a counterfactual approach relying ona three-step reweighting matching procedure, applied to survey data collected at nationallevel by ISTAT on a sample of upper secondary school graduates in 2004 and 2007. We?find that grants reduce drop-out and increase timely graduation, with larger effects amongmales and students in Central-Southern Italy, those who are more at risk of withdrawalfrom university.