Debt Aversion and the Demand for Loans for Postsecondary Education Academic Article

abstract

• The authors report the results of an experiment designed to measure the impact of different forms of subsidies on the demand for postsecondary education financing among a sample of adults ages 1855 in Canada. The experiment presents subjects with a series of choices involving trade-offs between cash payments and grants or loans earmarked for full or part-time education. In addition, the experiment includes experimental measures of time and risk preferences, and an extensive survey of experience and attitudes. This article focuses on the role of a person's attitudes toward debt (debt aversion) and experience with debt ( debt use) in the decision to take up subsidized loans for postsecondary education. Using survey measures, the authors find no evidence that debt aversion is an important barrier to investment in postsecondary education. In addition, subjects with experience carrying and managing debt are more willing than others to take on additional debt to finance postsecondary education.

authors

• Eckel, Catherine

published proceedings

• PUBLIC FINANCE REVIEW

altmetric score

• 3

author list (cited authors)

• Eckel, C. C., Johnson, C., Montmarquette, C., & Rojas, C.

citation count

• 51

complete list of authors

• Eckel, Catherine C||Johnson, Cathleen||Montmarquette, Claude||Rojas, Christian

publication date

• March 2007

publisher

• SAGE Publications  Publisher

published in

• Public Finance Review  Journal

keywords

• Debt Aversion
• Field Experiment
• Human Capital Investment
• Postsecondary Education
• Risk Aversion
• Time Preference

Digital Object Identifier (DOI)

• 10.1177/1091142106292774

start page

• 233

end page

• 262

volume

• 35

issue

• 2

URL

• http%3A%2F%2Fdx.doi.org%2F10.1177%2F1091142106292774

user-defined tag

• 4 Quality Education