The Effects of Merit Awards on District-Level High School Graduation: Evidence From Michigan

This paper considers the effects of the Michigan Merit Award, a college scholarship program, on high school graduation rates. Students qualify via a standardized high school proficiency exam. Identification is achieved through difference-in-differences estimation using both a broad set of controls and a stricter set of controls. The effects on graduation rates differ depending on the model specification, as some significant results show a positive correlation between the introduction of the program and graduation rates, while others a negative effect. Where it appears the award increased graduation rates, pinpointing the exact impact of the award on graduation levels is difficult because it appears that some of the gains in Michigan were continuations in existing trends. Other significant results shed some more light on educational inputs and their effects on graduation. Results are inconclusive on net, but tend to reject the notion that the award led to increased graduation rates.