Alaska Permanent Fund Dividend and its impact on Education: Do we study for the money?

Universal Basic Income (UBI) has been featured in political discussions over the last years. Both people in favour and against its adoption, have provided numerous arguments to support either its positive or negative impact. Empirical literature on the topic is scarce since, with few exceptions, not many experiments have been conducted so far to empirically assess its effects. I use the Alaska Permanent Fund Dividend, a UBI-like programme, to assess the implications of unconditional cash transfers on educational decisions. I use data from various governmental sources, and predominantly Consumer Population Survey (CPS) data from the Integrated Public Use Microdata Series (IPUMS), to construct a panel dataset of 2,091 stateyear observations. Using a synthetic control approach, I investigate how college enrolment and bachelor completion have been affected since the implementation of the dividend. The results show that college enrolments have no significant change with the implementation of the dividend but there is a significantly negative effect on bachelor degree completion.