IDEAS home Printed from https://ideas.repec.org/a/eee/ecoedu/v28y2009i2p170-177.html
   My bibliography  Save this article

An empirical analysis of borrowing behaviour of higher education students in the Netherlands

Author

Listed:
  • Oosterbeek, Hessel
  • van den Broek, Anja

Abstract

Many higher education students combine their study with a job on the side instead of taking up a loan. This paper examines the factors underlying this apparently myopic behaviour. We find that standard economic factors explain observed borrowing decisions to some extent. Students with easier access to financial resources borrow less often. Students with good earnings prospects and/or a high discount rate borrow more often, as do students who are prepared to take risks. An important non-standard factor affecting borrowing choices is debt aversion. We also find that a reduction in working hours will only have a limited positive impact on the time spend on studying.

Suggested Citation

  • Oosterbeek, Hessel & van den Broek, Anja, 2009. "An empirical analysis of borrowing behaviour of higher education students in the Netherlands," Economics of Education Review, Elsevier, vol. 28(2), pages 170-177, April.
    • Handle: RePEc:eee:ecoedu:v:28:y:2009:i:2:p:170-177
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0272-7757(08)00076-9
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde & Jürgen Schupp & Gert G. Wagner, 2005. "Individual Risk Attitudes: New Evidence from a Large, Representative, Experimentally-Validated Survey," Discussion Papers of DIW Berlin 511, DIW Berlin, German Institute for Economic Research.
    2. Brunello, Giorgio & Lucifora, Claudio & Winter-Ebmer, Rudolf, 2001. "The Wage Expectations of European College Students," IZA Discussion Papers 299, Institute of Labor Economics (IZA).
    3. Erica Field, 2006. "Educational Debt Burden and Career Choice: Evidence from a Financial Aid Experiment at NYU Law School," NBER Working Papers 12282, National Bureau of Economic Research, Inc.
    4. Shea, John, 2000. "Does parents' money matter?," Journal of Public Economics, Elsevier, vol. 77(2), pages 155-184, August.
    5. Sendhil Mullainathan & Marianne Bertrand, 2001. "Do People Mean What They Say? Implications for Subjective Survey Data," American Economic Review, American Economic Association, vol. 91(2), pages 67-72, May.
    6. Stephen V. Cameron & Christopher Taber, 2004. "Estimation of Educational Borrowing Constraints Using Returns to Schooling," Journal of Political Economy, University of Chicago Press, vol. 112(1), pages 132-182, February.
    7. Dinand Webbink, 2007. "Returns to University Education: Evidence from a Dutch Institutional Reform," Economica, London School of Economics and Political Science, vol. 74(293), pages 113-134, February.
    8. Barr, Nicholas, 1993. "Alternative Funding Resources for Higher Education," Economic Journal, Royal Economic Society, vol. 103(418), pages 718-728, May.
    9. Davies, Emma & Lea, Stephen E. G., 1995. "Student attitudes to student debt," Journal of Economic Psychology, Elsevier, vol. 16(4), pages 663-679, December.
    10. Loewenstein, George & Thaler, Richard H, 1989. "Intertemporal Choice," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 181-193, Fall.
    11. Shane Frederick & George Loewenstein & Ted O'Donoghue, 2002. "Time Discounting and Time Preference: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 351-401, June.
    12. Bas Jacobs & Frederick van der Ploeg, 2006. "Guide to reform of higher education: a European perspective [‘The efficiency of Australian universities: a data envelopment analysis’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 21(47), pages 536-592.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Machteld Hoeve & Geert Jan J M Stams & Marion van der Zouwen & Margaretha Vergeer & Kitty Jurrius & Jessica J Asscher, 2014. "A Systematic Review of Financial Debt in Adolescents and Young Adults: Prevalence, Correlates and Associations with Crime," PLOS ONE, Public Library of Science, vol. 9(8), pages 1-16, August.
    2. Lergetporer, Philipp & Woessmann, Ludger, 2019. "The Political Economy of Higher Education Finance: How Information and Design Affect Public Preferences for Tuition," Rationality and Competition Discussion Paper Series 145, CRC TRR 190 Rationality and Competition.
    3. Claire Callender & Geoff Mason, 2017. "Does Student Loan Debt Deter Higher Education Participation? New Evidence from England," The ANNALS of the American Academy of Political and Social Science, , vol. 671(1), pages 20-48, May.
    4. Booij, Adam S. & Leuven, Edwin & Oosterbeek, Hessel, 2012. "The role of information in the take-up of student loans," Economics of Education Review, Elsevier, vol. 31(1), pages 33-44.
    5. Bartkevičiūtė Gintarė & Gaigalienė Asta & Legenzova Renata, 2018. "The Assessment of Determinants of Credit Services’ Choices among Students," Management of Organizations: Systematic Research, Sciendo, vol. 79(1), pages 7-23, June.
    6. Herber, Stefanie P. & Kalinowski, Michael, 2016. "Non-take-up of Student Financial Aid: A Microsimulation for Germany," VfS Annual Conference 2016 (Augsburg): Demographic Change 145727, Verein für Socialpolitik / German Economic Association.
    7. Fairley, Kim & Weitzel, Utz, 2017. "Ambiguity and risk measures in the lab and students’ real-life borrowing behavior," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 67(C), pages 85-98.
    8. Stephan Thomsen & Friederike von Haaren-Giebel, 2016. "Did tuition fees in Germany constrain students’ budgets? New evidence from a natural experiment," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-25, December.
    9. Lergetporer, Philipp & Wößmann, Ludger, 2022. "Income Contingency and the Electorate's Support for Tuition," VfS Annual Conference 2022 (Basel): Big Data in Economics 264003, Verein für Socialpolitik / German Economic Association.
    10. Herber, Stefanie P. & Kalinowski, Michael, 2016. "Non-take-up of student financial aid: A microsimulation for Germany," BERG Working Paper Series 109, Bamberg University, Bamberg Economic Research Group.
    11. Mewse, Avril J. & Lea, Stephen E.G. & Wrapson, Wendy, 2010. "First steps out of debt: Attitudes and social identity as predictors of contact by debtors with creditors," Journal of Economic Psychology, Elsevier, vol. 31(6), pages 1021-1034, December.
    12. Yu Hao & Shuang Liu & Zhu Liduzi Jiesisibieke & Yi-Jie Xu, 2019. "What Determines University Students’ Online Consumer Credit? Evidence From China," SAGE Open, , vol. 9(1), pages 21582440198, March.
    13. Harrison, Neil & Agnew, Steve & Serido, Joyce, 2015. "Attitudes to debt among indebted undergraduates: A cross-national exploratory factor analysis," Journal of Economic Psychology, Elsevier, vol. 46(C), pages 62-73.
    14. Thomas Meissner & David Albrecht, 2022. "Debt Aversion: Theory and Measurement," Papers 2207.07538, arXiv.org, revised Jul 2022.
    15. Gicheva, Dora, 2016. "Student loans or marriage? A look at the highly educated," Economics of Education Review, Elsevier, vol. 53(C), pages 207-216.
    16. Kady Marie-Danielle Body & Liliane Bonnal & Jean-Fran篩s Giret, 2014. "Does student employment really impact academic achievement? The case of France," Applied Economics, Taylor & Francis Journals, vol. 46(25), pages 3061-3073, September.
    17. Stefanie P. Herber & Michael Kalinowski, 2016. "Non-Take-Up of Student Financial Aid: A Microsimulation for Germany," SOEPpapers on Multidisciplinary Panel Data Research 844, DIW Berlin, The German Socio-Economic Panel (SOEP).
    18. Aurora Ortiz-Nuñez, 2014. "Attitudes Toward Risk And Socioeconomic Factors Related To Educational Loans," Contemporary Economic Policy, Western Economic Association International, vol. 32(4), pages 710-718, October.
    19. Sprietsma, Maresa, 2015. "Student employment: Advantage or handicap for academic achievement?," ZEW Discussion Papers 15-085, ZEW - Leibniz Centre for European Economic Research.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Booij, Adam S. & Leuven, Edwin & Oosterbeek, Hessel, 2012. "The role of information in the take-up of student loans," Economics of Education Review, Elsevier, vol. 31(1), pages 33-44.
    2. Lergetporer, Philipp & Woessmann, Ludger, 2019. "The Political Economy of Higher Education Finance: How Information and Design Affect Public Preferences for Tuition," Rationality and Competition Discussion Paper Series 145, CRC TRR 190 Rationality and Competition.
    3. Cosmo, Valeria Di & O’Hora, Denis, 2017. "Nudging electricity consumption using TOU pricing and feedback: evidence from Irish households," Journal of Economic Psychology, Elsevier, vol. 61(C), pages 1-14.
    4. repec:cup:judgdm:v:16:y:2021:i:3:p:709-728 is not listed on IDEAS
    5. Lex Borghans & Angela Lee Duckworth & James J. Heckman & Bas ter Weel, 2008. "The Economics and Psychology of Personality Traits," Journal of Human Resources, University of Wisconsin Press, vol. 43(4).
    6. Luc Arrondel & André Masson, 2013. "Measuring savers' preferences how and why?," PSE Working Papers halshs-00834203, HAL.
    7. Meier, Stephan & Sprenger, Charles D., 2013. "Discounting financial literacy: Time preferences and participation in financial education programs," Journal of Economic Behavior & Organization, Elsevier, vol. 95(C), pages 159-174.
    8. Meier, Stephan & Sprenger, Charles, 2010. "Stability of Time Preferences," IZA Discussion Papers 4756, Institute of Labor Economics (IZA).
    9. O'Donoghue, Ted & Rabin, Matthew, 2008. "Procrastination on long-term projects," Journal of Economic Behavior & Organization, Elsevier, vol. 66(2), pages 161-175, May.
    10. Giles W Story & Ivaylo Vlaev & Ben Seymour & Joel S Winston & Ara Darzi & Raymond J Dolan, 2013. "Dread and the Disvalue of Future Pain," PLOS Computational Biology, Public Library of Science, vol. 9(11), pages 1-18, November.
    11. Yuri Biondi, 2009. "Capital budgeting under relational contracting: optimal ranking and duration criteria for schemes of concession, project-financing and public-private partnership," Post-Print hal-00404305, HAL.
    12. Seeun Jung, 2015. "Does education affect risk aversion? Evidence from the British education reform," Applied Economics, Taylor & Francis Journals, vol. 47(28), pages 2924-2938, June.
    13. Vischer, Thomas & Dohmen, Thomas & Falk, Armin & Huffman, David & Schupp, Jürgen & Sunde, Uwe & Wagner, Gert G., 2013. "Validating an Ultra-Short Survey Measure of Patience," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 120(2), pages 142-145.
    14. Chanda, Areendam, 2008. "The rise in returns to education and the decline in household savings," Journal of Economic Dynamics and Control, Elsevier, vol. 32(2), pages 436-469, February.
    15. Helena Skyt Nielsen & Torben Sørensen & Christopher Taber, 2010. "Estimating the Effect of Student Aid on College Enrollment: Evidence from a Government Grant Policy Reform," American Economic Journal: Economic Policy, American Economic Association, vol. 2(2), pages 185-215, May.
    16. Häckel, Björn & Pfosser, Stefan & Tränkler, Timm, 2017. "Explaining the energy efficiency gap - Expected Utility Theory versus Cumulative Prospect Theory," Energy Policy, Elsevier, vol. 111(C), pages 414-426.
    17. Daniele Checchi & Luca Flabbi, 2013. "Intergenerational Mobility and Schooling Decisions in Germany and Italy: The Impact of Secondary School Tracks," Rivista di Politica Economica, SIPI Spa, issue 3, pages 7-57, July-Sept.
    18. Bart Cockx & Corinna Ghirelli & Bruno Van der Linden, 2013. "Monitoring Job Search Effort with Hyperbolic Time Preferences and Non-Compliance: A Welfare Analysis," CESifo Working Paper Series 4187, CESifo.
    19. Stephan Thomsen & Friederike von Haaren-Giebel, 2016. "Did tuition fees in Germany constrain students’ budgets? New evidence from a natural experiment," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-25, December.
    20. Michael Daly & Liam Delaney & Séamus McManus, 2010. "Risk Attitudes as an Independent Predictor of Debt," Working Papers 201049, Geary Institute, University College Dublin.
    21. Christian Belzil & Arnaud Maurel & Modibo Sidibé, 2021. "Estimating the Value of Higher Education Financial Aid: Evidence from a Field Experiment," Journal of Labor Economics, University of Chicago Press, vol. 39(2), pages 361-395.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecoedu:v:28:y:2009:i:2:p:170-177. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/econedurev .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.