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An Economist's Perspective on Student Loans in the United States

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  • Susan M. Dynarski

Abstract

In this paper, I provide an economic perspective on policy issues related to student debt in the United States. I lay out the economic rationale for government provision of student loans, summarize time trends in student borrowing, describe the US loan market, then turn to topics central to the policy discussion of student loans: whether there is a student debt crisis, the costs and benefits of interest subsidies, and the suitability of an income-based repayment system for student loans. I close with a discussion of the gaps in the data required to fully analyze and steer student-loan policy.

Suggested Citation

  • Susan M. Dynarski, 2015. "An Economist's Perspective on Student Loans in the United States," CESifo Working Paper Series 5579, CESifo.
    • Handle: RePEc:ces:ceswps:_5579
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp5579.pdf
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    References listed on IDEAS

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    1. Marc Gurgand & Adrien Lorenceau & Thomas Mélonio, 2011. "Student loans: Liquidity constraint and higher education in South Africa," PSE Working Papers halshs-00590898, HAL.
    2. Raj Chetty & John N. Friedman & Nathaniel Hilger & Emmanuel Saez & Diane Whitmore Schanzenbach & Danny Yagan, 2011. "How Does Your Kindergarten Classroom Affect Your Earnings? Evidence from Project Star," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 126(4), pages 1593-1660.
    3. Thomas Piketty & Emmanuel Saez, 2003. "Income Inequality in the United States, 1913–1998," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(1), pages 1-41.
    4. Alex Solis, 2017. "Credit Access and College Enrollment," Journal of Political Economy, University of Chicago Press, vol. 125(2), pages 562-622.
    5. Susan Dynarski & Judith Scott-Clayton, 2013. "Financial Aid Policy: Lessons from Research," NBER Working Papers 18710, National Bureau of Economic Research, Inc.
    6. Erica Field, 2009. "Educational Debt Burden and Career Choice: Evidence from a Financial Aid Experiment at NYU Law School," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 1-21, January.
    7. Joshua D. Angrist & Stacey H. Chen & Jae Song, 2011. "Long-Term Consequences of Vietnam-Era Conscription: New Estimates Using Social Security Data," American Economic Review, American Economic Association, vol. 101(3), pages 334-338, May.
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    Cited by:

    1. Asare Eric & Segarra Eduardo, 2017. "Explaining Individuals¡¯ Behavior towards Their Acquisition of Students¡¯ Loan in the US," Applied Economics and Finance, Redfame publishing, vol. 4(3), pages 102-110, May.
    2. Kramer, Dennis A. & Lamb, Christina & Page, Lindsay C., 2021. "The effects of default choice on student loan borrowing: Experimental evidence from a public research university," Journal of Economic Behavior & Organization, Elsevier, vol. 189(C), pages 470-489.

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