A newer version of this project is available. See below for other available versions.

How Low Income Expectations Affect Student Loan Repayment Plan Choice: Survey Evidence from College Seniors

Principal Investigator(s): View help for Principal Investigator(s) Joshua Brownstein, Michigan State University; Scott Imberman, Michigan State University

Version: View help for Version V7

Version Title: View help for Version Title Updated Paper Based on Dissertation Committee Feedback. Fixed Typos.

Name	File Type	Size	Last Modified
Change in Income Expectations Change in Repayment Plan Choice.do	text/plain	3.5 KB	04/18/2023 11:14:AM
Compare Income Expectations to Major Specific Income.do	text/plain	1.1 KB	04/18/2023 11:14:AM
Create or Rename Variables for Survey Data Do File.do	text/plain	28.7 KB	04/18/2023 11:14:AM
Description of Variables.docx	application/vnd.openxmlformats-officedocument.wordprocessingml.document	19 KB	04/19/2023 08:00:AM
Difference in Proability of Earning 30k to 60k.do	text/plain	1.2 KB	04/18/2023 11:14:AM
Final Survey Data after Create or Rename Variables.dta	application/x-stata-dta	1.9 MB	04/18/2023 11:13:AM
Final_Survey_Data.csv	text/csv	620 KB	04/18/2023 11:13:AM
Heterogenity by Having Student Loans.do	text/plain	11.2 KB	04/18/2023 11:15:AM
Heterogenity by Income of Major.do	text/plain	10.6 KB	04/18/2023 11:14:AM
Heterogenity by Initial Plan Choice.do	text/plain	9.1 KB	04/18/2023 11:15:AM

Project Citation:

Brownstein, Joshua, and Imberman, Scott. How Low Income Expectations Affect Student Loan Repayment Plan Choice: Survey Evidence from College Seniors. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2023-06-22. https://doi.org/10.3886/E186081V7

Project Description

Summary: This material is based upon work supported by the National Science Foundation under Grant No. 2049358. Any opinions, findings, and conclusions or recommendations expressed in this material are those of the author and do not necessarily reflect the views of the National Science Foundation.

Income-driven repayment plans lower required payments for student loan borrowers when their income decreases. This helps to reduce student loan defaults. Despite universal availability, only a minority of student loan borrowers in the U.S. are in an income-driven repayment plan. In this study, I test whether a student’s choice of repayment plan is related to their expectations of earning a low income. Using an information experiment in a web survey, I create two groups of college seniors with an exogenous difference in low-income expectations. I find that respondents who see the major specific income information believe they, on average, have a higher probability of earning a low income. However, those respondents are not any more likely to choose the income-driven repayment plan. I conclude that students’ repayment plan preferences are not strongly related to their expectations of earning a low income. This may be due to students caring about things other than minimizing monthly payments when choosing a repayment plan.

Funding Sources: National Science Foundation (2049358)

Scope of Project

Subject Terms: Student Loan Repayment; Income Expectations; College Students

Collection Date(s): 10/19/2021 – 10/27/2021 (A link to the web survey was first emailed to students on 2021-10-19. I closed the survey on 2021-10-27)

Universe: Undergraduate Seniors at Michigan State University

Data Type(s): survey data

Methodology

Response Rate: 22.6% (1,581 completed surveys out of 7,000 students emailed the survey link)

Related Publications

Download this project

Published Versions

Export Metadata

Dublin Core

DDI 2.5

Report a Problem

Found a serious problem with the data, such as disclosure risk or copyrighted content? Let us know.

This material is distributed exactly as it arrived from the data depositor. ICPSR has not checked or processed this material. Users should consult the investigator(s) if further information is desired.