College scholarships, poverty, signaling and employment opportunities: Evidence from a field experiment

Abstract

We study the signaling effect of a college scholarship in a labor market where disadvantaged groups face discrimination. Using a correspondence (audit) study, we find that including information about being a scholarship recipient on a resume increases the likelihood of receiving a job interview callback by 20 %. However, the effect is much smaller for resume profiles featuring characteristics that are less common among low-income individuals. This pattern is consistent with the scholarship also conveying a negative socioeconomic signal to employers, helping explain why actual beneficiaries rarely include it on their resumes.