From the Battlefield to the Schoolyard

Abstract

The Post-9/11 GI Bill brought about an enormous expansion in veteran education benefits, roughly doubling the average maximum benefit level and generating large variation in the magnitude of benefit expansion across states. Using this context, I explore how enrollment of older, nontraditional students responds to educational subsidies. The transition from a conditional cash transfer to a more in-kind benefit affects the relative prices of different types of education, pushing veterans to invest in more expensive (plausibly higher-quality) schooling. Using a difference-in-differences strategy, combined with state level variation in the degree of benefit expansion, I find that the higher level of benefits increased college enrollment of separated veterans by between 15 and 20 percent while also shifting the composition of enrollment toward four-year schools.