Labor Market Polarization and Student Debt
Sanket Korgaonkar, Elena Loutskina, Constantine Yannelis
SSRN Working Paper,
2024
Abstract
This paper uses a new empirical design to explore how labor market polarization affects individuals’ incentive to pursue education funded on the margin by student debt. We argue that the labor market polarization–where automation replaces mid-skill and mid-education-level job–changes the marginal benefits of education and training and sharpens incentives to incur student debt. We advance a new measure of labor market polarizations that allows to capture the heterogeneity of this phenomena across geographies and time. Using this measure, we find that U.S. CBSAs that experience deeper labor market polarization see an increase in student debt balances and in the number of people pursuing student debt. On average, the decline in middle-skill jobs and wages has little effect on individuals’ ability to pay down existing student debt. The effects are most pronounced in ZIP codes with lower average credit scores, lower incomes, and higher share of the minority population.
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Mentoring Improves the School-to-work Transition of Disadvantaged Adolescents
Sven Resnjanskij, Jens Ruhose, Katharina Wedel, Simon Wiederhold, Ludger Woessmann
EconPol Forum,
No. 1,
2024
Abstract
This article evaluates the effectiveness of one of the largest mentoring programs for disadvantaged adolescents in Germany. The aim of the program “Rock Your Life!” is the successful transition of adolescents from lower secondary school to an apprenticeship or upper secondary school. Mentoring programs can strongly improve the transition from school to work for disadvantaged adolescents. The results show that substituting a lack of family support with other adults can help disadvantaged children in adolescence.
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