Rising college student debt levels have received considerable media coverage and have even prompted policy proposals that link rising student debt with tuition inflation. This article examines the role of state aid policies coupled with tuition and financial aid policy and academic outcomes in determining variation in average student debt. A focus solely on tuition as the culprit in rising student debt misses the significant role that state and institutional financial aid policies and student outcomes play in determining debt levels across higher education institutions. Specifically, colleges and universities being need-blind in admissions, meeting-full-need, limiting loans, and graduating students in high paying majors can have a larger impact on student debt levels than can the cost of attendance. Similarly, higher state-provided student aid significantly lowers average student debt at public universities.
AveryChristopherTurnerSarah. 2012. Student loans: Do college students borrow too much—or not enough?Journal of Economic Perspectives26 (1): 165–92.
2.
BrenemanDavid. 1970. The Ph.D. production function: The case of Berkeley. Ford Foundation Program for Research in University Administration Paper. Berkeley, CA: Ford Foundation.
3.
BrewerDominic J.GatesSusan M.GoldmanCharles A.2002. In pursuit of prestige: Strategy and competition in U.S. higher education. New Brunswick, NJ: Transaction Publishers.
4.
BussChristianParkerJeffreyRivenburgJon. 2004. Cost, quality, and enrollment demand at liberal arts colleges. Economics of Education Review23 (1): 57–65.
5.
CarnevaleAnthonyStrohlJeffMeltonMichelle. 2011. What it’s worth: The economic value of college majors. Washington, DC: Georgetown Center on Education and the Workforce.
6.
CauchonDennis. 18October2011. Student loan debt surpasses $1 trillion. USA Today. Available from http://www.usatoday.com.
7.
ClotfelterCharles. 1996. Buying the best: Cost escalation in elite higher education. Princeton, NJ: Princeton University Press.
8.
College Board. 2011. Trends in student aid, 2011. New York, NY: The College Board. Available from http://trends.collegeboard.org.
9.
College Board. 2012. Trends in college pricing, 2012. New York, NY: The College Board. Available from http://trends.collegeboard.org.
10.
CravenJulia. 5July2013. Universities attempting to lower student loan debt. USA Today. Available from http://www.usatoday.com.
11.
DelaneyJennifer A.2014. The role of state policy in promoting college affordability. The ANNALS of the American Academy of Political and Social Science, (this volume).
12.
DuffyElizabeth A.GoldbergIdana. 1997. Crafting a class: College admissions and financial aid, 1955–1994. Princeton, NJ: Princeton University Press.
13.
FieldErica. 2009. Educational debt burden and career choice: Evidence from a financial aid experiment at NYU Law School. American Economic Journal: Applied Economics1 (1): 1–21.
14.
GarvinDavid A.1980. The economics of university behavior. New York, NY: Academic Press.
15.
JamesEstelle. 1990. Decision processes and priorities in higher education. In The economics of American universities, eds. HoenackStephen A.CollinsEileen L., 77–106. Buffalo, NY: State University of New York Press.
16.
Joint Economic Committee of the United States Congress.2013. The causes and consequences of increasing student debt. Prepared by the Joint Economic Committee Democratic Staff, G-01 Dirksen Senate Office Building, Washington, DC.
17.
LinsenmeierDavid M.RosenHarvey S.RouseCecilia E.2006. Financial aid packages and college enrollment decisions: An econometric case study. Review of Economics and Statistics88 (1): 126–45.
18.
LuongMay. 2010. The financial impact of student loans. Perspectives on Labour and Income22 (1): 29–42.
19.
MacyAnnTerryNeil. 2007. The determinants of student college debt. Southwestern Economic Review34 (1): 15–25.
20.
MartinAndrewLehrenAndrew W.13May2012. A generation hobbled by college debt. New York Times.
21.
MassyWilliam F.ZemskyRobert. 1994. Faculty discretionary time: Departments and the academic ratchet. Journal of Higher Education65 (1): 1–22.
22.
MelguizoTatianaStroberMyra H.2007. Faculty salaries and the maximization of prestige. Research in Higher Education48 (6): 633–68.
23.
MinicozziAlexandra. 2005. The short term effect of educational debt on job decisions. Economics of Education Review24 (4): 417–30.
24.
MonksJames. 2001. Loan burdens and educational outcomes. Economics of Education Review20 (6): 545–50.
25.
National Association of State Student Grant and Aid Programs. 2002. 32nd annual survey report 2000-2001 academic year: State-funded scholarship/grant programs for students to attend postsecondary education institutions. Washington, DC: National Association of State Student Grant and Aid Programs.
26.
National Association of State Student Grant and Aid Programs. 2012. 42nd annual survey report on state-sponsored student financial Aid. Washington, DC: National Association of State Student Grant and Aid Programs.
27.
National Center for Education Statistics, Department of Education. 2012. Digest of education statistics, 2011. Washington, DC: National Center for Education Statistics.
28.
The Project on Student Debt. 2012. Summary of pledges: Eligibility guidelines and basic provisions (2009–10). Available from http://projectonstudentdebt.org.
29.
ReynoldsGlenn Harlan. 28June2013. What’s really “immoral” about student loans. Wall Street Journal. Available from http://online.wsj.com/news/articles/.
30.
RothsteinJesseRouseCecilia E.2011. Constrained after college: Student loans and early-career occupational choices. Journal of Public Economics95:149–63.
31.
TumenSarahShulrufBoaz. 2008. The effect of student loan schemes on students returning to study. Journal of Higher Education Policy and Management30 (4): 401–14.
32.
WaddellGlen R.SingellLarry D.2011. Do no-loan policies change the matriculation patterns of low-income students?Economics of Education Review30 (2): 203–14.
33.
WenzlRoy. 10August2013. Crippling student debt affects economy and that’s bad news for everyone, expert at KU says. The Wichita Eagle. Available from http://www.kansas.com.
34.
The White House. 22August2013. Fact sheet on the President’s plan to make college more affordable: A better bargain for the middle class. Washington, DC: Office of the Press Secretary of the White House. Available from http://www.whitehouse.gov.
35.
ZemskyRobertWegnerGregoryMassyWilliam F.2006. Remaking the American university: Market-smart and mission-centered. New Brunswick, NJ: Rutgers University Press.
