(Trying to) catch up with the higher-skilled Joneses: student loans in a segmented educational market from a post-Keynesian perspective
Gustavo Pereira Serra
Journal of Post Keynesian Economics, 2025, vol. 48, issue 2, 172-203
Abstract:
This paper analyzes the economic effects of student loans in a segmented educational market. The motivation here draws upon some studies that verify differences in labor income returns and repayment difficulties depending on the characteristics of the institution attended by the student. I put forward a neo-Kaleckian model that considers three types of households: rentiers (RHs), lower-skilled workers (LSWs), and higher-skilled workers (HSWs). Moreover, a cost-minimizing representative firm combines physical capital and labor in effective units in the production process, which also features some labor skill substitution, thus generating a bargaining process between the different worker groups over the wage gap. The main result is that, for a debt-financed human capital investment, the conditions that drive long-term economic growth do not necessarily align with those that reduce the wage gap and household debt. In fact, in some cases, widening the wage gap may be a necessary condition for boosting economic activity and human capital accumulation. However, this investment might not drive down wage inequality and could raise concerns about household debt.
Date: 2025
References: Add references at CitEc
Citations:
Downloads: (external link)
http://hdl.handle.net/10.1080/01603477.2025.2460794 (text/html)
Access to full text is restricted to subscribers.
Related works:
Working Paper: (Trying to) Catch Up with the Higher-Skilled Joneses: Student loans in a segmented educational market from a Post-Keynesian perspective (2024) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:mes:postke:v:48:y:2025:i:2:p:172-203
Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/MPKE20
DOI: 10.1080/01603477.2025.2460794
Access Statistics for this article
More articles in Journal of Post Keynesian Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().