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Elizabeth Jaramillo Rojas (Northwestern): Beyond Recipients: Sibling Spillovers of College Financial Aid

 
Abstract: This paper studies sibling spillovers from a large-scale college financial aid program in Colombia. In 2014, the government launched Ser Pilo Paga (“Hard Work Pays Off”), a merit- and need-based scholarship targeting high-achieving students from low-income households. Eligibility was determined jointly by household poverty status and performance on the national high school exit exam. I use these criteria as a source of quasi-random variation to estimate effects on younger siblings’ outcomes. When an older sibling qualifies, younger siblings’ exam scores rise by 0.11 standard deviations (26 percent), their probability of immediate college enrollment increases by 14 percent, and enrollment shifts toward high-quality, mostly private, universities. Labor outcomes follow a U-shape: employment falls in the first four years as college attendance rises but is 3.2 percentage points higher by year six. We also find large social returns: the probability of a criminal conviction among younger siblings falls by 63 percent, with effects concentrated in the poorest households. Younger siblings of students who were close to receiving the scholarship also show modest gains, consistent with increased motivation.