Does Financial Aid Really Drive Up Tuition?

In 1987, William Bennett wrote a piece in the New York Times with the headline “Our Greedy Colleges.” Bennett was the U.S. Secretary of Education at the time, and he argued that increases in federal financial aid had allowed colleges “blithely to raise their tuitions, confident that Federal loan subsidies would help cushion the increase.”  But what became known as the “Bennett Hypothesis” has been hard to prove.