A description of tuition and maintenance loan take-up

We also make use of two additional variables-living at home and paid work during term-time-that capture two possible ways in which students can reduce or avoid the need for loans. Living at home while at university is divided into three categories: never, partially and always. The middle category includes all those who entered higher education at wave 6 and changed accommodation in wave 7. Similarly, the variable coding for work during term-time includes a category for irregular work.

The models presented below use probit for consistency. Part of this research aims at analysing the importance of the nature of student loans. To do so, we estimate two models simultaneously in Table 3, a design that is only possible for categorical outcomes when using the probit transformation. Consequently, the other model has also been estimated using a probit.

Each column in Table 2 presents model estimates that address the first part of our three research questions regarding the key determinants of loan take-up

Table 1 describes students who do and do not take out loans. It strongly supports the hypothesis that these two student groups are different, especially regarding parental wealth and debt aversion. While there is little to no difference in parental social class between student borrowers and non-borrowers, the other indicators of wealth show the expected relationship. Read more