38 p.Prior empirical evidence finds that merit-aid programs such as the Georgia
Hope Scholarship yield large and significant enrollment effects, whereas need-based
aid programs such as the Pell Grant yield modest and often insignificant enrollment
effects. This paper uses unpublished panel data on the number and level of Pell
awards at Southern universities along with detailed institutional data from the
National Center of Educational Statistics to examine whether the Georgia Hope
Scholarship improved the college access of needy students relative to other Southern
states. Fixed-effect analyses show that large increases in merit aid improve college
access of needy students and leverage Hope Scholarship funds with greater federal
Pell assistance. Whereas most institution-specific increases in both Pell enrollment and funding are found for two-year and less selective, four-year institutions, the results also suggest that Pell students are not crowded out of more selective schools by Hope’s intent to retain the best Georgia high-school students
