Repayment Burdens of Student Loans for Vietnamese Higher Education

26 Pages Posted: 26 Feb 2013

See all articles by Bruce Chapman

Bruce Chapman

Australian National University, Research School of Social Sciences (RSSS) - Economics Program; Australian National University (ANU) - Crawford School of Public Policy

Amy Y.C. Liu

Crawford School of Public Policy

Date Written: February 7, 2013

Abstract

The time is approaching when Vietnamese higher education students will be required to contribute more to the direct costs of the process. As well, continued expansion of the system will become increasingly difficult without the institution of an effective student loans policy designed to assist with both tuition and living costs. Of major policy interest in this future scenario, and the topic of this paper, are the potential financial difficulties that borrowers are likely to face with 'repayment burdens' (RB), the proportion of incomes needed to repay their loans. We show how significant this issue is likely to be by constructing a hypothetical student loans system and calculating RBs for male and female graduates residing in four different parts of Vietnam. We find that there are likely to be significant problems, potentially leading to high default rates, for many graduates if the financing of higher education expansion uses typical forms of student loans.

Keywords: student loans, repayment burden, government aid, Vietnam

JEL Classification: I00, I20, I22, I28

Suggested Citation

Chapman, Bruce James and Liu, Amy Y.C., Repayment Burdens of Student Loans for Vietnamese Higher Education (February 7, 2013). Crawford School Research Paper No. 13-06, Available at SSRN: https://ssrn.com/abstract=2213076 or http://dx.doi.org/10.2139/ssrn.2213076

Bruce James Chapman (Contact Author)

Australian National University, Research School of Social Sciences (RSSS) - Economics Program ( email )

HC Coombs Building
Australian National University
Canberra, Australian Capital Territory 0200
Australia

Australian National University (ANU) - Crawford School of Public Policy

ANU College of Asia and the Pacific
J.G. Crawford Building, #132, Lennox Crossing
Canberra, Australian Capital Territory 0200
Australia

Amy Y.C. Liu

Crawford School of Public Policy ( email )

ANU College of Asia and the Pacific
Canberra, Australian Capital Territory 0200
Australia
61-2-6125 0177 (Phone)

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