The Effect of Online Education on Student Loan Borrowing: Evidence From the Beginning Postsecondary Students Study 12/17 (BPS:12/17)

• In Event: Sheraton Roundtable Session Seven
  In Roundtable Session: Student Outcomes as Policy Responses (Table 3)

Abstract

This paper examines whether online higher education has led to lower student loan borrowing. Using data from the Beginning Postsecondary Students Study 12/17, I show that although the official price of cost is lower for online students, there is no significant difference in the number of student loans overall. Strikingly, students who have earned an online bachelor's degree at a for-profit institution borrow significantly more unsubsidized loans than their peers in in-person programs. A similar result holds true for students who have earned an online associate degree at a for-profit institution and subsidized loans. Potential mechanisms are analyzed. These findings imply that online education may not be a reliable and equal solution to reducing the runaway student loan debt.

Author

• Yitong Hu, New York University
  Presenting Author