Behavioral Biases and Student Loan Repayment Plans

Awarded Scholars:
Daniel Kreisman, Georgia State University
James C. Cox, Georgia State University
Susan Dynarski, University of Michigan
Project Date:
Jun 2016
Award Amount:
Project Programs:
Behavioral Economics

Within five years of exiting school, roughly a quarter of student borrowers from the most recent (2009) cohort had already gone through loan deferment, forbearance and delinquency. This can be explained in part by the fact that the benefits of attending college do not accrue immediately after graduation, whereas loan repayments begin soon after college attendance ends. Currently, the federal government offers four income-based repayment plans, or Pay As You Earn plans (PAYE), to help students manage their loans after graduating. 

Economists Daniel Kreisman, James Cox and Susan Dynarski will conduct a laboratory experiment with Georgia State University undergraduates to better understand which informational changes seem promising for effecting repayment option choices. They will collect: self-reported student demographic information and current funding situation, and institutional records, including demographics, FAFSA records and current loan and grant amounts. This duplicative process will serve as a check on the information students provide and show how well students understand their own current funding situation.


RSF: The Russell Sage Foundation Journal of the Social Sciences is a peer-reviewed, open-access journal of original empirical research articles by both established and emerging scholars.


The Russell Sage Foundation offers grants and positions in our Visiting Scholars program for research.


Join our mailing list for email updates.