The student loan system has been a major topic of discussion since its introduction. Many believe that the loan system would make access to higher education more unequal. Research by Bas Karreman and Zhiling Wang, Associate Professors Applied Economics at Erasmus School of Economics, and Frank van Oort, Professor of Applied Economics, shows, however, that the loan system does not affect the choice to study. The research does find an effect of the loan system on the choice of study.
Increasing average study debt
Before the loan system was introduced, students received an allowance to cover a part of their study costs. This allowance was around 300 euros for students living away from home and 100 euros for students living at home. It was still possible to borrow money at a low interest rate, to cover other costs. As a result of the abolition of the allowance, students increasingly started taking out student loans. In addition, the average student debt increased considerably, from around 12,400 euros in 2015 to 13,700 euros in 2019.
HAVO graduates more likely to opt for a study with a higher starting salary
The research by Karreman, Wang and van Oort compares the study choices of VMBO students, who often still receive an allowance, with those of HAVO and VWO students in the years before and after the introduction of the loan system. In addition, various occupations and functions with high starting salaries are linked to study programmes. The results show that the study choice of VWO students hardly changed after the introduction of the student loan system. ‘On the other hand, we did see an effect among secondary school students with a HAVO diploma', Karreman says in an article of Dutch newspaper NRC. HAVO students choose a study with a higher starting salary more often than before.
Students living away from home make different study choices
‘Especially women who go to college choose differently. Just like students with parents who have a relatively low salary', says Karreman. Higher education students who have to stay in student rooms due to the large distance between their home and place of study, also opt for a study with a higher starting salary more often. The research also shows that the loan system had an effect on the number of students who choose to live away from home. This number has halved between the years 2013 and 2017. According to Karreman, students who do leave their homes, choose a study programme with a higher starting salary more often, in order to be able to pay off their student debt more easily after studying.
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The full article from NRC, 7 August 2020, can be found above (in Dutch).