Did Free Tuition Change the Choices of Students Applying for University Admission?

How does a policy of free tuition affect student applications to universities? This article assesses how free tuition influences applications in terms of the selectivity of the university, length of the degree program, cost of the program, and application to a program in the STEM field. The study based on a quasi-experimental design was carried out in Chile using OLS, regression adjustment and matching analysis, and governmental data. Participants in the study were 384,830 applicants from three cohorts of high school graduates who applied to 30 selective universities. Two groups of applicants were compared: those who applied in 2015, before the introduction of free tuition; and those who applied in 2016 and 2017, when free tuition was introduced. The comparison was made considering the group with the lowest family income. Except for cost, the results show that the offer of free tuition had a small impact on the choices of applicants. With free tuition, a few more students applied to higher cost programs. The response may be explained in part by the fact that free education replaced the financing mechanism based on scholarships and loans, which covered a large part of the costs of the degree programs.