In 2001, the federal government enacted a law that forbade any student with a drug offense from
Question:
In 2001, the federal government enacted a law that forbade any student with a drug offense from receiving financial aid. Lovenheim and Owens (2014) study the effect of this law on college enrollment behavior by examining how enrollment among those with convictions changes relative to those without convictions in a difference-in-difference analysis. A difference-in-difference analysis takes two successive differences. The first difference is the difference between the pre and post-treatment values of a group that underwent treatment and the difference between the pre and post-treatment values of a group that did not undergo treatment. Once these two values are calculated, the difference between these differences is computed.
a). Using the provided information, calculate the difference-in-difference estimate
No Conviction | Conviction | |
Pre-Change | 0.623 | 0.358 |
Post-Change | 0.652 | 0.269 |
b). Does the fact that college enrollment was rising throughout the United States for all students over the period cause a problem for their study?
International Business Law and its Environment
ISBN: 9781305972599
10th edition
Authors: Richard Schaffer, Filiberto Agusti, Lucien J. Dhooge