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Life in shackles? The quantitative implications of reforming the educational financing system

Heijdra, Ben ; Kindermann, Fabian ; Reijnders, Laurie


We conduct a quantitative analysis of educational financing systems in a stochastic overlapping generations model in which human capital can be enhanced through both formal schooling and learning-by-doing. The model is calibrated to the United States economy, including a stylized version of its student loan system. We find that moving to an income-contingent educational financing system, whereby ...


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