Modeling the Effects of Financial Aid on Student Enrollment Decisions: A Quantitative Case Study of a Private Catholic University
type: CreativeWork
description: Over the last two decades, many institutions of higher education have experienced admissions-related problems due to fluctuations in student enrollment and the increasing need for institutional financial aid. Because of this, administrators need tools that can help them modify policy as the market changes. The purpose of this research was to develop a tool for a private, more selective institution that would answer the following questions: (1) what is the probability of enrollment for each admitted student, and (2) how would changes in the financial aid package affect this probability? The model in this research was based on both economic theory and the results of other empirical work, and was refined through statistical analysis. Its goal was to develop the best predictive model using the data collected by the institution and available to it at the time admission and financial aid decisions are made. The methodology was carried out in three steps. First, an enrollment probability model was estimated using three years (1998-2000) of admissions data from the institution, using both logistic and probit regression. The model included a unique set of explanatory variables, including religious affiliation and distance from home, showing the ease at which institutions can look at the variables that are important for their goals, policies, and practices. The second step was a tem poral validation against additional data. The model was tested for predictive accuracy against the admissions data for 2001. After rerunning the model for all four years, the final step in the methodology was to simulate the effects on enrollment of various changes in the tuition and financial aid policy, and to calculate price sensitivity. The results of this study, for the most part, confirm ed economic theory and general empirical findings. The signs and significance of most coefficients were as expected. A unique finding was that a linear, constantly decreasing functional form for net price wa…
abstract: Over the last two decades, many institutions of higher education have experienced admissions-related problems due to fluctuations in student enrollment and the increasing need for institutional financial aid. Because of this, administrators need tools that can help them modify policy as the market changes. The purpose of this research was to develop a tool for a private, more selective institution that would answer the following questions: (1) what is the probability of enrollment for each admitted student, and (2) how would changes in the financial aid package affect this probability? The model in this research was based on both economic theory and the results of other empirical work, and was refined through statistical analysis. Its goal was to develop the best predictive model using the data collected by the institution and available to it at the time admission and financial aid decisions are made. The methodology was carried out in three steps. First, an enrollment probability model was estimated using three years (1998-2000) of admissions data from the institution, using both logistic and probit regression. The model included a unique set of explanatory variables, including religious affiliation and distance from home, showing the ease at which institutions can look at the variables that are important for their goals, policies, and practices. The second step was a tem poral validation against additional data. The model was tested for predictive accuracy against the admissions data for 2001. After rerunning the model for all four years, the final step in the methodology was to simulate the effects on enrollment of various changes in the tuition and financial aid policy, and to calculate price sensitivity. The results of this study, for the most part, confirm ed economic theory and general empirical findings. The signs and significance of most coefficients were as expected. A unique finding was that a linear, constantly decreasing functional form for net price wa…
author: Siefert, Linda, EdD
keywords: case study, financial aid, higher education, predictive model, private Catholic University, quantitative, student enrollment decisions, Leadership Studies
date published: 2002-01-01T08:00:00Z
date modified: 2026-07-24T05:41:03Z
provider: University of San Diego
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: University of San Diego