The role of information in the take-up of student loans
AbstractPolicies need not only to be well designed to effectively address market failures, but their parameters also need to be part of agents\' information sets. We study student loan behavior in the Netherlands where i) higher education students know little about the conditions of the government\'s financial aid program and ii) take-up rates are low. We conducted a field experiment in which we manipulated the amount of information students have about these conditions. Half a year after the treatment the same students were interviewed again. The treatment has no impact on loan take-up. This zero impact is not due to students already having decided whether to take a loan or not, and can also not be attributed to treated students not absorbing the information that is given to them. We provide the interpretation that - given that aid application is sufficiently straightforward -communicating eligibility criteria rather than precise programme details should be prioritized.
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Bibliographic InfoPaper provided by Top Institute for Evidence Based Education Research in its series Working Papers with number 32.
Date of creation: 00 2010
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- 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.
- I22 - Health, Education, and Welfare - - Education - - - Educational Finance
- I28 - Health, Education, and Welfare - - Education - - - Government Policy
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
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- Marty McGuigan & Sandra McNally & Gill Wyness, 2012. "Student Awareness of Costs and Benefits of Educational Decisions: Effects of an Information Campaign," CEE Discussion Papers 0139, Centre for the Economics of Education, LSE.
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