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Gustavo Manso

Institution

UC Berkeley

PhD Year

2006

manso@berkeley.edu

FTG Membership

Senior Member

Website

https://faculty.haas.berkeley.edu/manso/

Featured Work

Mar 2, 2026

Gustavo Manso, Alejandro Rivera, Hui (Grace) Wang, Han Xia | Working Paper No. 00202-00

Student Loans and Labor Supply Incentives

We develop a dynamic household finance model showing that student loans -- non-dischargeable in the U.S. bankruptcy -- alleviate the well-documented debt overhang in labor supply decisions. Non-dischargeability mutes opportunities for households to strategically reduce labor supply at the expense of creditors, thus mitigating incentive distortions. This effect, however, is partially undone by Income-Driven Repayment (IDR) plans, which set student loan payments formulaically regardless of...