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Financing tertiary education in Indonesia: assessing the feasibility of an income-contingent loan system.

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Title: Financing tertiary education in Indonesia: assessing the feasibility of an income-contingent loan system.
Authors: Elmira, Elza1, Suryadarma, Daniel1 dsuryadarma@smeru.or.id
Source: Higher Education (00181560). Feb2020, Vol. 79 Issue 2, p361-375. 15p. 6 Graphs.
Subject Terms: *Postsecondary education, *Student loan debt, Income-contingent loans, Loan reimbursement
Abstract: This paper examines the feasibility of an income-contingent loan system to finance tertiary education in Indonesia. Using graduates' income data from the 2015 National Labor Force Survey, we modeled the life-cycle income distribution of university graduates using unconditional quantile regression. We used these estimates to simulate different income-contingent loan (ICL) schemes to observe the effect on the amount of repayment, length of repayment, government subsidy, and repayment burden of males and females in different quantiles of income. We simulated three loan schemes: without real interest, with a 25% surcharge on the total loan, and with 2% real interest. Implicit government subsidy was lowest with the 25% surcharge scheme. Results showed that ICL with a lower repayment burden is feasible in Indonesia and can increase access to tertiary education. We also discussed the administrative capacity among tax authorities. [ABSTRACT FROM AUTHOR]
Copyright of Higher Education (00181560) is the property of Springer Nature and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)
Database: Education Research Complete
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  Data: Financing tertiary education in Indonesia: assessing the feasibility of an income-contingent loan system.
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  Data: <searchLink fieldCode="AR" term="%22Elmira%2C+Elza%22">Elmira, Elza</searchLink><relatesTo>1</relatesTo><br /><searchLink fieldCode="AR" term="%22Suryadarma%2C+Daniel%22">Suryadarma, Daniel</searchLink><relatesTo>1</relatesTo><i> dsuryadarma@smeru.or.id</i>
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  Data: <searchLink fieldCode="JN" term="%22Higher+Education+%2800181560%29%22">Higher Education (00181560)</searchLink>. Feb2020, Vol. 79 Issue 2, p361-375. 15p. 6 Graphs.
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  Data: *<searchLink fieldCode="DE" term="%22Postsecondary+education%22">Postsecondary education</searchLink><br />*<searchLink fieldCode="DE" term="%22Student+loan+debt%22">Student loan debt</searchLink><br /><searchLink fieldCode="DE" term="%22Income-contingent+loans%22">Income-contingent loans</searchLink><br /><searchLink fieldCode="DE" term="%22Loan+reimbursement%22">Loan reimbursement</searchLink>
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  Data: This paper examines the feasibility of an income-contingent loan system to finance tertiary education in Indonesia. Using graduates' income data from the 2015 National Labor Force Survey, we modeled the life-cycle income distribution of university graduates using unconditional quantile regression. We used these estimates to simulate different income-contingent loan (ICL) schemes to observe the effect on the amount of repayment, length of repayment, government subsidy, and repayment burden of males and females in different quantiles of income. We simulated three loan schemes: without real interest, with a 25% surcharge on the total loan, and with 2% real interest. Implicit government subsidy was lowest with the 25% surcharge scheme. Results showed that ICL with a lower repayment burden is feasible in Indonesia and can increase access to tertiary education. We also discussed the administrative capacity among tax authorities. [ABSTRACT FROM AUTHOR]
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  Data: <i>Copyright of Higher Education (00181560) is the property of Springer Nature and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract.</i> (Copyright applies to all Abstracts.)
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        Value: 10.1007/s10734-019-00414-3
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      – Code: eng
        Text: English
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      – SubjectFull: Postsecondary education
        Type: general
      – SubjectFull: Student loan debt
        Type: general
      – SubjectFull: Income-contingent loans
        Type: general
      – SubjectFull: Loan reimbursement
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              Text: Feb2020
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