Various studies have been conducted on to the extent to which grant has created effect on the lives of the individuals especially students. Many writers have tried to analyze the impact created by the grants on the students. It also came to the notice that between 1972 and 1982, there was no change in the numbers of students coming from the minorities groups after the announcement of the Pell Grant.
With this one can come to the conclusion that maybe Pell Grants have failed to solve this purpose. But several commentators implied that assumption could be based on several per posit comparisons. Since last 30 years, many of the American studies have been focusing and looking at the Student Price Response Co-efficient, in fact even Jackson and Weatherby, Manski and Wise had conducted on the wide small-scale price response studies.
Each of these studies found negative relationships between the net price and enrolment. They were able to come to the conclusion that increase in the composition of grants can offset negative effects of the tuition fees. While making assessment of the grant and retention is the fact that grants constitute only part of the participation and retention picture and constitute part of the total student aid picture.
The Institute of the Intergovernmental Relations found that students have to face three types of financial restraints and all should be satisfied if student has to attend tertiary education. The first barrier in front of the student is the price constraint, where the individual has a belief that the total price or cost should offset the benefits of educational choice. Second they face cash or liquidity constraint whereby individual is not able to cover the cost of attainment of education.
The third barrier is debt aversion, showing reluctance to get into debt in order to gain education. It is very important to point out the fact that these barriers are in effect in the form of sequence, suppose if somebody is facing price constraint then cash constraint and debt aversion would be rendered insufficient. Overall grants are basically in use to overcome the first barrier. But unless the cash/liquidity barrier overcomes, it is very difficulty to overcome the first barrier.
Here the thing that needs to be noted that grants available by the government are in essence limited, therefore the grant would not fully fund educational expenses. If student plans to join a community college where the tuition fees are comparably lower then it would be all the more possible that grants at all cost would cover larger percentage of the tuition fees.
Secondly if the government does need analysis, contribution of the parents is generally higher than what is expected of most of the parents; this has an impact on the amount available to the students for grants. Then if the parent or a guardian makes a claim of the fact that student is dependent on the income tax returns, this would surely have an impact on the amount of aid available to the student. If any student is independent of their parents according to the tax laws, he or she will be entitled more in the form of financial aid.
