Please use this identifier to cite or link to this item: http://hdl.handle.net/1893/28314
Appears in Collections:Faculty of Health Sciences and Sport Journal Articles
Peer Review Status: Refereed
Title: Economic Growth and the Harmful Effects of Student Loan Debt on Biomedical Research
Author(s): Ferretti, Fabrizio
McIntosh, Bryan
Jones, Simon
Keywords: Biomedical researchers
Economic growth
Higher education cost
Student loan debt
Equality of opportunity
Issue Date: 31-Dec-2015
Citation: Ferretti F, McIntosh B & Jones S (2015) Economic Growth and the Harmful Effects of Student Loan Debt on Biomedical Research. Economic Modelling, 49, pp. 308-313. https://doi.org/10.1016/j.econmod.2015.05.004.
Abstract: Modern theories of economic growth emphasize the role of research and development (R&D) activities in determining a society's standard of living. In some advanced economies, however, higher education costs and the level of indebtedness among graduates have increased dramatically during recent years.Student loans are evident throughout the Western world, particularly in the United States, and within the biomedical sciences. In this paper the authors develop a basic model of economic growth in order to investigate the effects of biomedical graduates indebtedness on the allocation of human resource in the R&D activities, and thus on the process of economic growth. Using this modified model to understand the consequences of the rising cost in biomedical education, we derive a 'science-growth curve' (a relation between the share of pure researcher and the economy rate of growth), and we find two possible effects of biomedical student indebtedness on economic growth: specifically, a composition effect and a productivity effect. First, we outline the Romer's classical growth model, and we apply it to a 'biomedical' knowledge-based economy, and second, the model is developed by factoring the difference between pure and applied biomedical research. The 'biomedical science sector' is one of the key pillars of modern knowledge-based economy. The costs of higher education in biomedical sciences and the graduates level of indebtedness represent, not only a great problem of equality of opportunity, but also a serious threat to future prosperity of the advanced economies.
DOI Link: 10.1016/j.econmod.2015.05.004
Rights: Published under a Creative commons CC BY NC ND 4.0 (https://creativecommons.org/licenses/by-nc-nd/4.0/)

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