Starting from 2005, Georgia saw a rapid decline in tertiary gross enrollment. In a country where poverty reduction is a key priority and where labor market outcomes have not been particularly strong during the last decade, the decline in higher education enrollment might appear as an additional obstacle to human and economic development.

In this report, we analyze a time series of tertiary gross enrollment in Georgia and compare Georgia to other countries in transition. We use the Integrated Household Survey (IHS) data of the National Georgian Statistics Agency (GeoStat) to analyze the socio-economic profiles of enrolled and not-enrolled students. Further, we identify the key potential factors behind decreased enrollment rates, and discuss the role of institutional changes, wages, returns to education, external and international migration, and employment patterns.

The key concern of this study is the impact of social welfare payments targeting the poorest strata of the Georgian population on higher education enrollment. We address this question by compiling and analyzing a unique dataset matching: 1) data on poverty scores and beneficiary status of State Social Assistance Program of Georgia’s households from the Social Service Agency (SSA) with 2) data on entrance examinations and allocation of scholarship from 2005 to 2013 from the National Examination Center (NAEC). Using these data we, first, identify the role of liquidity constraints in limiting access to higher education for the poorest segment of the Georgian population. Second, we employ the regression discontinuity framework to examine the causal impact of unconditional cash transfers on university enrollment.