Release Date: Friday, April 26, 2002

TERRY COLLEGE PROFESSORS RECEIVE $176,000 NSF GRANT TO CONTINUE STUDY OF HOPE SCHOLARSHIP'S EFFECTS ON COLLEGE ENROLLMENT

ATHENS, Ga. — The National Science Foundation has renewed and increased funding for additional research by two University of Georgia professors concerning the impact of Georgia's pioneering HOPE Scholarship program.

Chris Cornwell and David Mustard, both of whom are economics professors in UGA's Terry College of Business, were awarded $176,000 from the NSF for their proposal, "Merit Aid and Sorting: The Effects of HOPE-style Scholarships on College Stratification by Ability, Race and Gender." The two-year grant will be used to study Georgia's merit-based college scholarship program, focusing on the influence such a program can have in determining which students attend college and where.

Established in September 1993 and funded by Georgia Lottery proceeds, HOPE is one of the largest educational subsidies in the U.S. with two unique characteristics: the scholarship is awarded entirely on a merit basis and there is no income cap. Since its inception, more than $1.4 billion has been distributed to almost 600,000 students attending in-state public, private and technical institutions.

Cornwell and Mustard began studying HOPE and its effects in 1997. Their earlier HOPE research, also funded by an NSF grant, examined the enrollment effects of the program. Their first study indicated that HOPE increased the state's overall freshman enrollment rate by about 8 percent between 1993 and 1997 — mainly attributable to the scholarship's incentive for students to remain in Georgia. The study also found that the enrollment gains were concentrated in the state's four-year colleges and universities.

"This second grant is a renewal of the first, extending the initial research, but with different focus areas," Mustard said.

According to the researchers, a family's available resources determine where a child lives and where they begin their schooling, which affects the child's college prospects. Receiving a basic education and attending a good high school makes a student more likely to meet the academic requirements necessary to attend college. A college degree, in turn, improves labor and marriage market opportunities. How a combination of factors such as these affects what happens to an individual is referred to as "sorting."

Individual sorting is "a pervasive fact of life," according to Cornwell and Mustard, with available resources early in life strongly influencing the level and quality of a person's postsecondary education. Given this established correlation between household income and merit, Cornwell and Mustard theorize programs like the HOPE Scholarship serve to reinforce sorting patterns in existence long before a student considers going to college.

By analyzing UGA student records and databases including other U.S. universities, Cornwell and Mustard will examine how merit aid has altered the distribution of college students on the basis of academic ability, race and gender.

To qualify for the HOPE scholarship, high school students must graduate with a 3.0 grade point average in their core-curriculum courses. However, among students eligible for HOPE, the highest achievers have increasingly sought admission to UGA and the state's other research universities, Cornwell said. As a result, freshman admission standards have risen, making it more competitive for students with even above-average standardized test scores and grades to get in.

"One of the most significant trends in higher education is the very rapid change from need-based to merit-based aid," Mustard said. "The U.S. has historically subsidized higher education to promote college enrollment for academically able students who lacked the resources to attend college. In contrast, merit aid assists students solely on the basis of academic achievement, typically ignoring their ability to pay for college. The HOPE program is the prototype in this nationwide trend away from need-based aid." More than a dozen states have passed laws establishing merit scholarship programs and other states are currently considering proposals.

Terry College Dean P. George Benson said he was pleased to hear the NSF funding requested by Cornwell and Mustard had been renewed. "Naturally, we're very happy that the National Science Foundation wants Chris and David to continue their research. Georgia is at the forefront of merit-based financial aid, and their initial study of the HOPE program uncovered some very interesting trends. We expect their upcoming project will yield equally intriguing information," Benson said.

The National Science Foundation is an independent U.S. government agency responsible for reviewing and promoting research and educational projects in science and engineering. To obtain Cornwell and Mustard's existing papers and their NSF/HOPE research agendas, go online to: http://www.terry.uga.edu/hope.

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