Investing in Human Capital A Capital Markets Approach to Student Funding [Hardcover]

This 2004 book examines how 'human capital contracts' transfer financial risk of higher education from students to investors.Financing Human Capital argues for the use of instruments in which students agree to pay a percentage of their income during a specified period of time in exchange for funds to finance their education. Such instruments are named 'human capital contracts' and the main difference with respect to loans is the variable value of the payments students make during the repayment period. The financial consequences of human capital contracts-risk transfer from students to investors and increased information regarding future graduates' earnings-make them an attractive alternative for funding higher education.Financing Human Capital argues for the use of instruments in which students agree to pay a percentage of their income during a specified period of time in exchange for funds to finance their education. Such instruments are named 'human capital contracts' and the main difference with respect to loans is the variable value of the payments students make during the repayment period. The financial consequences of human capital contracts-risk transfer from students to investors and increased information regarding future graduates' earnings-make them an attractive alternative for funding higher education.This study recommends employing human capital contracts wherein students agree to pay a percentage of their income over time in exchange for funds to finance their education. The main difference between human capital contracts and loans is the variable value of the payments students make during the repayment period. Their financial consequences, of risk transfer from students to investors and increased information regarding future graduates' earnings, make the contracts an attractive alternative in funding higher education.List of figures; List of tables; Foreword; Acknowledgements; Introduction; Part I. The Problem of Financing Education: 1. The valuló(