Does reducing student support affect scholastic performance? Evidence from a Dutch reform

This paper investigates the impact of student support on performance and time allocation of students in Dutch higher education. In 1996 the maximum duration of grants was reduced by 1 year, and thereby limited to the nominal duration of the study program. This reform could have had substantial financial consequences for students. We evaluate the effects of the reform using a difference-in-differences approach. Our main findings are that after the reform, students early in their study (i) switched less to other programs, (ii) obtained higher grades, while (iii) they did not spend more time studying or working. In addition, for students not older than 20 years when they started their study we find larger effects on all performance variables (switching, percentage of completed courses, graduation in the first year and grade point averages). These findings are consistent with recent evidence on heterogeneous treatment effects for higher ability students.