For years student scholarship programs to promote knowledge or international cooperation have functioned without question in Mexico. Economics of education literature has questioned the validity of similar programs, and the paradigm is shifting from scholarship support to loan schemes and from merit- to need-based grants. This article, based on the Mexican case, analyzes two large governmental scholarship programs to finance international higher education: CONACYT (Mexican National Science and Technology Agency) and Fulbright. Using data published by the two programs, I conclude that the U.S. and Mexican administering agencies have implemented a scholarship policy that benefits a population group that did not need public support in the first place. Evidence seems to indicate that the taxpayers’ funds have been used inefficiently. This calls for a significant change in policy for the Mexican case. Some lessons may be drawn for other countries with similar programs and similar levels of economic development.
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