Student indebtedness in the UK has become ubiquitous since the introduction of student loans in the early 1990s.  It has been argued that this has had multiple impacts on the student experience, including a fear of debt dissuading prospective students (Callender and Jackson 2005), a link with mental health issues (Cooke et al 2004) and an increased long-term comfort with borrowing (Lea et al 2001).

However, the UK is not in an isolated situation, with many OECD countries moving towards systems that require many of their students to borrow to meet some/all of the costs of their education.  Each is unique in history, scale, criteria and the meaning attached to debt by students and wider society.  For example, interest and repayment terms vary considerably between countries, potentially influencing behaviour and the individual’s responses to the experience.

Despite the growing issues with student debt, whether incurred through student loans or commercial borrowing, it remains an under-researched phenomenon.  In particular, there are no international comparative studies which seek to understand how and why responses to debt may differ within and between countries.  This study seeks to address this gap by focusing on three countries in which student indebtedness is widespread: the UK, the US and New Zealand (NZ).  These three countries form a useful basis of comparison due to their shared language and elements of their national culture (Hofstede 2001).  However, the findings of this study are expected to have a wider relevance for other countries in Europe and beyond.

Being focused on theory development in a relatively new field, this study primarily takes its lead from previous empirical studies.  Harrison et al (in press) used rich interview data to reveal a wide range of attitudes to debt among UK undergraduates, proposing seven types ranging from anger to positivity, with most students reporting a stoical acceptance based on an understanding that debt was a ‘necessary evil’ to achieve a graduate career.  Haultain et al (2010) suggest that students’ debt attitudes are mainly explained by recourse to just two underlying dimensions: fear of debt and an appreciation of the utility of debt.  Using data from the Netherlands, Oosterbeek and van den Broek (2009) argue that an aversion to debt is a key determinant of behaviour.  In their large-sample Irish study, Daly et al (2010) find that personality traits including extraversion, neuroticism and openness are significant predictors for commercial borrowing, while Bachan (2013) argues that perceptions of risk are salient.

The aim of this study is to explore how attitudes to debt are constructed by contemporary university students, expressed through the following research questions:

1. What are the underlying latent variables that construct a students’ affective and cognitive experience of indebtedness?
2. Are these related to aspects of individual personality or to demographic circumstances and, if so, what is the nature of the relationship?
3. Is the construction of debt attitudes similar between countries and, if not, what aspects of national policy or culture might contribute to the differences?

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