Marching Across Generations? An Analysis of the Benefits Transfer Provision
of the Post-9/11 GI Bill (w/ B. Castleman & W. Skimmyhorn)
RESEARCH OVERVIEW
Goals
1. Depict the dilemma presented by benefits transfer with an
economic model and test predictions from that model against
observational data of transfer behavior.
DESCRIPTIVE ANALYSIS
Economic Model of Benefits Transfer
Fran Murphy,
UVa Curry & US Army
ESTIMATING THE RETENTION EFFECT
Simplified Timeline for Army Career
2. Assess whether there is a causal retention effect attributable
to the benefits transfer provision.
Background
• Congress approved the (first) GI Bill of Rights in 1944;
nearly 8 million WWII veterans used the benefits.
• There have been some changes to the GI Bill since World
War II, but the intent of the legislation remains unchanged.
• The Veterans Education Assistance Act of 2008 (or, post9/11 GI Bill) was a major program update:
• 36 months paid tuition at the most expensive
public university in state home of record
• Monthly housing allowance and stipend for books
• Benefits extended to officers for the first time
• Ability to transfer benefits to a family member
• Service member must have 6 years of service in the Armed
Forces and commit to 4 more years of active service in
order to transfer benefits. He must also have a family
member eligible to receive the benefits.
Retention Effect: Midcareer Soldiers
Predictions from the Model
1. More educated parents are more likely to transfer benefits.
2. Parents with a lower cost of military service – this is c(Z) –
are more likely to transfer benefits:
*higher years of service
*higher military rank
*less-intense recent combat history
Summary of Transfer Behavior – First Cohort
Difference-in-Differences Specification
Main Findings
• Our model captures much complexity of the economic
tradeoffs in benefits transfer and performs well in the data.
• Takeup for the transfer benefit is highest among service
members who earn higher wages, have completed their
education, and are nearer to or already at pension eligibility.
• This is the first empirical paper that we are aware of to study
the transfer provision of the post-9/11 GI Bill; we also
could not find analysis of similar program (i.e. – labor
supply and intrafamily education benefits exchange).
• We find evidence that some parents are willing to exchange
labor supply (in a hazardous profession) for intrafamily
benefits – could apply to other professions / labor markets.
Regression Results
Future Work
• Explore informational / behavioral barriers that may
underlie clear socioeconomic patterns in transfer behavior.
• Determine whether benefits transfer policy had higher
education attainment effects for military children.
Note: Marginal transfer measures initial benefits transfer made in a given year.
Data Sources: US Army Office of Economic and Manpower
Analysis (OEMA) and US Department of Veterans Affairs