The impact of income contingent provisions on students' loan taking behaviour
Purpose – This paper aims to investigate the determinants of taking out government-funded student loans for university study in Australia. Design/methodology/approach – The paper uses an ordered probit model to quantify the influence of the various factors which affect students’ decisions on fundin...
| Main Authors: | , |
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| Format: | Journal Article |
| Published: |
Emerald Group Publishing Ltd.
2008
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| Online Access: | http://hdl.handle.net/20.500.11937/20246 |
| _version_ | 1848750253092634624 |
|---|---|
| author | Birch, E. Miller, Paul |
| author_facet | Birch, E. Miller, Paul |
| author_sort | Birch, E. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | Purpose – This paper aims to investigate the determinants of taking out government-funded student loans for university study in Australia. Design/methodology/approach – The paper uses an ordered probit model to quantify the influence of the various factors which affect students’ decisions on funding their tertiary study using student loans or through other means. Findings – The study finds that the probability of taking out student loans for the full cost of university is largely influenced by students’ socioeconomic status. Other major influences on this decision include students’ demographic and university enrolment characteristics. Research limitations/implications – A limitation of the work is that only a neighbourhood (rather than an individual-level) measure of socioeconomic status was available, and future research should seek to address this. Practical implications – The research shows that the parameters of loan schemes do not seem to be able to over-ride the influence that family background has on loan taking behaviour. That is, poor students use loans regardless of the parameters of the loans scheme in order to overcome short-term credit constraints. In other words, these student loan schemes channel funds to those without other means of funding their higher education. Originality/value – By showing the impact that income contingent provisions have on loan taking behaviour, the paper informs policy makers of potential impacts from modifying loans schemes to reflect this characteristic. |
| first_indexed | 2025-11-14T07:33:53Z |
| format | Journal Article |
| id | curtin-20.500.11937-20246 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T07:33:53Z |
| publishDate | 2008 |
| publisher | Emerald Group Publishing Ltd. |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-202462017-09-13T16:04:40Z The impact of income contingent provisions on students' loan taking behaviour Birch, E. Miller, Paul Loans Australia Universities Students Purpose – This paper aims to investigate the determinants of taking out government-funded student loans for university study in Australia. Design/methodology/approach – The paper uses an ordered probit model to quantify the influence of the various factors which affect students’ decisions on funding their tertiary study using student loans or through other means. Findings – The study finds that the probability of taking out student loans for the full cost of university is largely influenced by students’ socioeconomic status. Other major influences on this decision include students’ demographic and university enrolment characteristics. Research limitations/implications – A limitation of the work is that only a neighbourhood (rather than an individual-level) measure of socioeconomic status was available, and future research should seek to address this. Practical implications – The research shows that the parameters of loan schemes do not seem to be able to over-ride the influence that family background has on loan taking behaviour. That is, poor students use loans regardless of the parameters of the loans scheme in order to overcome short-term credit constraints. In other words, these student loan schemes channel funds to those without other means of funding their higher education. Originality/value – By showing the impact that income contingent provisions have on loan taking behaviour, the paper informs policy makers of potential impacts from modifying loans schemes to reflect this characteristic. 2008 Journal Article http://hdl.handle.net/20.500.11937/20246 10.1108/01443580810844406 Emerald Group Publishing Ltd. fulltext |
| spellingShingle | Loans Australia Universities Students Birch, E. Miller, Paul The impact of income contingent provisions on students' loan taking behaviour |
| title | The impact of income contingent provisions on students' loan taking behaviour |
| title_full | The impact of income contingent provisions on students' loan taking behaviour |
| title_fullStr | The impact of income contingent provisions on students' loan taking behaviour |
| title_full_unstemmed | The impact of income contingent provisions on students' loan taking behaviour |
| title_short | The impact of income contingent provisions on students' loan taking behaviour |
| title_sort | impact of income contingent provisions on students' loan taking behaviour |
| topic | Loans Australia Universities Students |
| url | http://hdl.handle.net/20.500.11937/20246 |