Taking It to the Limit: Effects of Increased Student Loan Availability on Attainment, Earnings, and Financial Well-Being

Sandra Black, Jeffrey Denning, Lisa J. Dettling (), Sarena Goodman () and Lesley Turner
Additional contact information
Lisa J. Dettling: Federal Reserve Board of Governors
Sarena Goodman: Federal Reserve Board of Governors

No 15874, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Growing reliance on student loans and repayment difficulties have raised concerns of a student debt crisis in the United States, but little is known about the effects of student borrowing on human capital and long-run financial well-being. We use variation induced by recent expansions in federal loan limits combined with administrative datasets to identify the effects of increased access to student loans on credit-constrained students' educational attainment, earnings, debt, and loan repayment. Increased student loan availability raises student debt and improves degree completion, later-life earnings, and student loan repayment while having no effect on homeownership or other types of debt.

Keywords: credit constraints; student debt (search for similar items in EconPapers)
JEL-codes: I20 I21 I22 (search for similar items in EconPapers)
Pages: 64 pages
Date: 2023-01
New Economics Papers: this item is included in nep-edu and nep-ltv
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Citations: View citations in EconPapers (4)

Published - published in: American Economic Review, 2024, 113 (12), 3357–3400

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Related works:
Journal Article: Taking It to the Limit: Effects of Increased Student Loan Availability on Attainment, Earnings, and Financial Well-Being (2023)
Working Paper: Taking It to the Limit: Effects of Increased Student Loan Availability on Attainment, Earnings, and Financial Well-Being (2020)
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