The short- and long-run effects of paying disadvantaged teenagers to go to school

We evaluate the Education Maintenance Allowance, a large conditional cash transfer that paid teenagers from lower-income backgrounds up to $3,200 per year to remain in full-time education beyond the compulsory school-leaving age.

Exploiting the program's staggered rollout in England, we find that it increased education participation and reduced crime. However, we find no improvements in test scores, no effect on qualifications beyond the lowest level, and a small negative effect on labour market outcomes up to age 30. A key channel appears to be delayed labour market entry without offsetting gains in human capital.

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