Are federal student loan accountability regulations effective?

Christopher V. Lau

Economics of Education Review, 2020, vol. 75, issue C

Abstract: Within the education sector, accountability regulations have been used with the intended purpose of improving student outcomes. In higher education, one such regulation aims to improve the ability of borrowers to repay their student loans by placing sanctions on institutions with excessive student loan defaults. This paper examines whether student loan accountability regulations were able to (1) lower student loan defaults, and (2) address the broader objective of improving repayment ability, by exploiting a change to the period in which the regulation’s performance measure was monitored. I find that the change to the regulation resulted in less student loan defaults at for-profit colleges. I also find that this reduction in student loan defaults resulted in a short-term improvement in repayment ability at for-profit, but not nonprofit, institutions.

Keywords: Higher education; School accountability; Student loan defaults; For-profit colleges (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecoedu:v:75:y:2020:i:c:s0272775719303796

DOI: 10.1016/j.econedurev.2020.101957

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