Attitudes of college seniors toward graduate student loan debt: the role of financial education
Metadatos
Mostrar el registro completo del ítemAutor
Salas Velasco, ManuelEditorial
Emerald
Materia
Behavioral economics Econometric modeling Cost-benefit analysis
Fecha
2024-05-02Referencia bibliográfica
Salas-Velasco, M. (2024), "Attitudes of college seniors toward graduate student loan debt: the role of financial education", Journal of Financial Economic Policy, Vol. 16 No. 4, pp. 442-462. https://doi.org/10.1108/JFEP-09-2023-0259
Resumen
Purpose – This paper aims to examine prospective graduate students’ attitudes toward educational loan
borrowing in an experimental setting.
Design/methodology/approach – Participants were randomly assigned to two treatment groups and
one control group. Subjects in experimental group 1 received financial education: a short online course on the
economic viability of getting a master’s degree and how to finance it with a graduate student loan, while
subjects in experimental group 2 received financial education along with information on the availability bias.
Findings – Relying on a control group in the assessment of financial literacy education intervention
impacts, this research finds positive causal treatment effects on individuals’ attitudes toward debt-financed
graduate education. In comparison to the control group, experimental subjects perceived the possibility of
going into debt with a graduate loan to complete a master’s degree as less stressful and worrying.
Practical implications – This study has important educational policy implications to prevent students
from stopping investing in human capital by perceiving educational loan debt as something stressful or
worrying. The results can help potential (and current) grad students develop a feasible financial plan for
graduate school by encouraging higher education institutions to implement educational loan information and
financial education into university seminar courses for better graduate student loan decision-making.
Originality/value – Student attitudes toward debt have been analyzed in the context of higher education, but
only a fewresearchers internationally have used an experimental design to study personal financial decision-making.