Since 1964, the Federal Work-Study (FWS) program has provided funds to subsidize the wages of student employees, but it has never been studied directly.
In this paper, the author uses an instrumental variables difference-in-difference framework with administrative data from West Virginia to identify causal effects of FWS. The study compared eligible and ineligible students across institutions with higher and lower FWS availability and used differences in FWS availability to instrument for actual FWS participation.
The author finds no evidence that FWS participation improves academic outcomes for the full sample, but this masks significant negative effects for women and some significant positive effects for men. Although results should be interpreted cautiously given limitations of the sample, they represent the first direct, quasi-experimental evidence regarding the effect of the program.
