Keywords: Program evaluation, financial aids, university enrollment, regression discontinuity design
Using a counterfactual approach, this paper empirically investigates the impact of an educational program recently introduced in the province of Trento (North-East of Italy). The aim of the policy is to foster university enrollment of students from low-income families and reduce inequalities in access to Higher Education. The program, known as Grant 5B, consists in generous monetary incentives that are targeted to university students from low-income families and are awarded based on both merit and demonstrated financial need. We analyze data from an ad hoc survey conducted on a sample of upper secondary graduates. We employ a regression discontinuity design to estimate the impact of the intervention on university enrollment. We find that the program has no significant effects on enrollment rates. Relying on the relative risk aversion theory, we explain why a relaxation of the eligibility rules based on merit might be more effective in reducing social inequalities in access to university.