More from the Author

• Working Paper | 2019

  Second Chance: Life Without Student Debt

  Marco Di Maggio, Ankit Kalda and Vincent Yao

  Rising student debt is considered one of the creeping threats of our time. This paper examines the effect of student debt relief on individual credit and labor market outcomes. We exploit the plausibly random debt discharge due to the inability of National Collegiate, the largest owner of private student loan debt, to prove chain of title for thousands of loans across the United States. Using hand-collected lawsuits filings matched with individual credit bureau information, we find that borrowers experiencing the debt relief shock reduce their indebtedness by 26%, by both reducing their demand for credit and limiting the use of existing credit accounts. They are also 12% less likely to default on other accounts. After the discharge, the borrowers' geographical mobility increases as well as their probability to change jobs. Ultimately their income increases by more than $4,000 over a three-year period, which is equivalent to about two months' average salary. These findings speak to the benefits of intervening in the student loan market to reduce the consequences of debt overhang problems by forgiving student debts.

  Keywords: student loans; debt relief; Borrowing and Debt; Personal Finance; Outcome or Result; United States;

  Citation:

  Di Maggio, Marco, Ankit Kalda, and Vincent Yao. "Second Chance: Life Without Student Debt." NBER Working Paper Series, No. 25810, May 2019.  View Details

  CiteView Details Read Now

  Related

• Case | HBS Case Collection | December 2018 (Revised March 2019)

  iyzico: Fundraising in Emerging Markets (A)

  Marco Di Maggio and Gamze Yucaoglu

  The case opens in 2016 as Barbaros Ozbugutu, co-founder and CEO of the Istanbul-based payment technology start-up iyzico, contemplates the offers the company received for its Series C round. The case then describes iyzico’s origins and provides a detailed overview of the business model and growth story that led iyzico to dominate the industry in Turkey within three years of its founding. Having raised A and B rounds from local and institutional investors in 2014 and 2015 respectively, Ozbugutu believes that iyzico could benefit from another round in 2016, this time from international venture capital, to reach its aggressive growth targets. In the summer of 2016, after an intense few months of talks with potential investors, Ozbugutu was looking at five competitive term sheets from funds with great fintech know-how and emerging-markets experience. From the previous rounds, he knew that if he chose the right investors—ones who could also act as advisors—surprises would be rare. He now needed to weigh the pros and cons of the different term sheets and VCs and decide which offers to ultimately accept.

  Keywords: iyzico; fundraising; Business Startups; Venture Capital; Emerging Markets; Private Sector; For-Profit Firms; Management; Technology; Growth Management; Corporate Entrepreneurship; Negotiation Offer; Decision Making; Turkey;

  Citation:

  Di Maggio, Marco, and Gamze Yucaoglu. "iyzico: Fundraising in Emerging Markets (A)." Harvard Business School Case 219-064, December 2018. (Revised March 2019.)  View Details

  CiteView DetailsEducatorsPurchase

  Related

• Case | HBS Case Collection | November 2018 (Revised March 2019)

  Roofstock: The Cloud of Real Estate Investing

  Marco Di Maggio and Julia Kelley

  Citation:

  Di Maggio, Marco, and Julia Kelley. "Roofstock: The Cloud of Real Estate Investing." Harvard Business School Case 219-021, November 2018. (Revised March 2019.)  View Details

  CiteView DetailsEducatorsPurchase

  Related