Measuring Student Debt and Its Performance

21 Pages Posted: 11 Apr 2014

See all articles by Donghoon Lee

Donghoon Lee

Federal Reserve Bank of New York; New York University

Wilbert van der Klaauw

Federal Reserve Bank of New York; IZA

Andrew Haughwout

Federal Reserve Bank of New York

Meta Brown

Federal Reserve Bank of New York

Joelle Scally

Federal Reserve Bank of New York

Date Written: April 1, 2014

Abstract

Studies continue to indicate that higher education is frequently a worthwhile investment for individuals and that it raises the productivity of the workforce as a whole. While the rising cost of post-secondary education has not eliminated this "college premium," it has raised new questions about how growing numbers of students can make these investments. One solution to this problem is student loans, which have come to play an increasingly important role in financing higher education. Yet, despite its importance, educational debt is not well understood. Among the reasons is that there exist few central repositories of information on the characteristics and performance of all student loans, which currently include loans made by both government and private lenders. In this paper, we bring a new data set to bear on this important issue and present a brief analysis of the historical and current levels of student debt and how those loans are performing. We also briefly discuss the implications of student loans for borrowers and the economy.

Keywords: student debt, household debt

JEL Classification: D12, D14, I22

Suggested Citation

Lee, Donghoon and van der Klaauw, H. Wilbert and Haughwout, Andrew F. and Brown, Meta and Scally, Joelle, Measuring Student Debt and Its Performance (April 1, 2014). FRB of New York Staff Report No. 668. Available at SSRN: https://ssrn.com/abstract=2423377 or http://dx.doi.org/10.2139/ssrn.2423377

Donghoon Lee (Contact Author)

Federal Reserve Bank of New York ( email )

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New York University

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H. Wilbert Van der Klaauw

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States
212-720-5916 (Phone)
212-720-1844 (Fax)

IZA ( email )

Andrew F. Haughwout

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States
212-720-2685 (Phone)
212-720-1844 (Fax)

Meta Brown

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

Joelle Scally

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

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