Paralysis by analysis? Effects of information on student loan take-up

Benjamin Marx and Lesley Turner

Economics of Education Review, 2020, vol. 77, issue C

Abstract: Can relevant information influence student borrowing? In a field experiment with a large community college, we send emails about federal student loans to students who have received financial aid offers but have not made a borrowing decision. A treatment reminding students that they need not borrow the maximum amount of available loan aid has no effect. Treatments referencing amounts borrowed by recent graduates shift students from borrowing the maximum amount to not borrowing. Consistent with the hypothesis that students experience cognitive overload when presented with multiple loan amounts, the response is largest among low-performing students and arises from inaction.

JEL-codes: D12 D14 D91 H31 I22 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecoedu:v:77:y:2020:i:c:s0272775720301515

DOI: 10.1016/j.econedurev.2020.102010

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