The Onus of Student Debt: Who is Most Impacted by the Rising Cost of Higher Education?

With an average undergraduate student accumulating debt of over $37,000, burdens like these have the potential to fray the social and economic fabric of the country. Using a sample of over 13,000 undergraduate students at a large comprehensive university, we estimate a selection bias corrected OLS r...

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Bibliographic Details
Published inInternational research journal of applied finance Vol. 10; no. 8; pp. 219 - 231
Main Authors Beal, Mary, Borg, Mary O, Stranahan, Harriet A
Format Journal Article
LanguageEnglish
Published Hyderabad International Research Journal of Applied Finance 01.01.2019
Subjects
College students
Debt restructuring
Economic crisis
Microeconomics
Public finance
Student debt
Student loans
United States > US
Florida
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Summary:With an average undergraduate student accumulating debt of over $37,000, burdens like these have the potential to fray the social and economic fabric of the country. Using a sample of over 13,000 undergraduate students at a large comprehensive university, we estimate a selection bias corrected OLS regression to determine student characteristics and programs that best predict student loan debt. Our results suggest that the decision to take on student debt and the amount of debt accrued does differ based upon demographic characteristics and major of study. Not surprisingly, the results suggest that students with greater support from home have lower debt burdens. Finally the model shows a strong impact of Florida's Bright Futures Scholarships (FBF) on student debt burdens. Whereas previous research suggested that FBF benefit higher socioeconomic groups, our model suggests that lower income scholarship recipients benefit more in terms of reduced accumulated loan debt.
ISSN:2229-6891