Lenders — whether private or government — would be more discerning about handing out loans for advanced degrees if they had to consider borrowers' creditworthiness.
Education can be the best investment you make, unless it's for graduate school. Students seeking advanced degrees make up only 25% of student borrowers, yet they account for nearly half of outstanding student loans.
Many Americans feel they have no choice but to keep pursuing more education after they graduate from college. There was a time when that first degree was enough to ensure a good job. But degree inflation compels many graduates to keep going, even if that second degree puts them into debt and doesn't always offer great value. Since 2000, the number of master's conferred jumped nearly 80% compared with a rise of 55% for bachelor's.
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Allison Schrager is a senior fellow at the Manhattan Institute and a contributing editor of City Journal.
This piece originally appeared in Bloomberg Opinion