Discusses the Higher Education Act of 1992, which increased the availability of student loan funds. Examines the difference in effects of background, achievement and aspiration, college experience, price variables, and accumulated debt in 1993 as compared with 1996 on student persistence decisions. Finds that current year subsidies are positively…

This study explored the role of financial aid in promoting year-to-year persistence over a five-year period following reauthorization of the Higher Education Act in 1992. The study cohort included 6,711 full-time beginning freshmen in the fall 1993/1994 terms at Arizona State University. Variables examined were (1) effects of receiving any…