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Does the Student-Loan Burden Weigh into the Decision to Start a Family?

Dora Gicheva

No 11-14, UNCG Economics Working Papers from University of North Carolina at Greensboro, Department of Economics

Abstract: I examine the relationship between student debt and the timing of marriage. The life-cycle consumption smoothing model implies that student loans should have a very small effect on consumption at any given point in time and should not affect the timing of family formation. I use the Survey of Consumer Finances to show that the amount of student borrowing is negatively related to the probability of marriage, but the strength of this relationship diminishes with age. I use exogenous variations in the availability of student loans since the 1970s to address the endogeneity of student debt. I supplement my results with data from a panel survey of registrants for the Graduate Management Admission Test. Data on reported marriage expectations suggest that Master of Business Administration students who borrow for their education may not have perfect foresight.

Keywords: Student Loans; Credit Constraints; Timing of Marriage (search for similar items in EconPapers)
JEL-codes: D91 H52 I23 J12 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2011-09-07
New Economics Papers: this item is included in nep-edu and nep-lab
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