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Student loans and the allocation of graduate jobs

Author

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  • Alessandro Cigno
  • Annalisa Luporini

Abstract

In an economy where graduate jobs are allocated by a matching tournament, and some of the potential participants cannot borrow against their expected future earnings, the government can increase efficiency and ex ante equity by redistributing wealth or, if that is not possible, by borrowing wholesale and lending to potential participants. Both policies replace some of the less able rich with some of the more able poor and bring education investments closer to their first-best levels.

Suggested Citation

  • Alessandro Cigno & Annalisa Luporini, 2013. "Student loans and the allocation of graduate jobs," CHILD Working Papers Series 16, Centre for Household, Income, Labour and Demographic Economics (CHILD) - CCA.
    • Handle: RePEc:cca:wchild:16
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    File URL: http://www.child.carloalberto.org/images/documenti/child16_2013.pdf
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    Cited by:

    1. is not listed on IDEAS
    2. Masao Nakagawa & Asuka Oura & Yoshiaki Sugimoto, 2022. "Under- and over-investment in education: the role of locked-in fertility," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(2), pages 755-784, April.

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    Keywords

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    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory

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