We develop a human capital model with borrowing constraints explicitly derived from government student loan programs and private lending under limited commitment. Two key implications of our analysis are: (i) binding constraints may not depress investment; and (ii) a positive relationship...

More than low default rates, lenders are interested in the expected return on their loans. In this paper, we consider a number of other measures of repayment and nonpayment that are likely to be of direct interest to lenders. Using data from the Baccalaureate and Beyond Longitudinal Study, we...

Rising costs of and returns to college have led to sizeable increases in the demand for student loans in many countries. In the U.S., student loan default rates have also risen for recent cohorts as labor market uncertainty and debt levels have increased. We discuss these trends as well as...

Government student loan programs must balance the need to enforce repayment among borrowers who can afford to make their payments with some form of forgiveness or repayment assistance for those who cannot. Using unique survey and administrative data from the Canada Student Loan Program, we show...

This analysis confirms our findings from the Defaulter Survey regarding quantitatively important relationships between repayment problems and borrower income. We also identify an important role for student debt, educational attainment, and beliefs about repayment. The analysis further reveals...