We study the effects of a change in financial aid policy introduced by a Northeastern
university in 1998. Prior to that time, the university s financial aid packages for lowincome
students consisted of grants, loans, and campus jobs. After the change, the entire
loan portion of the package for low-income students was replaced with grants. We find
the program increased the likelihood of matriculation by low-income students by about 3
percentage points, although the effect is not statistically significant. The effect among
low-income minority students was about twice that size and statistically significant at the
10 percent level.