However, while the available data limits deeper analysis of this issue, it seems reasonable to suspect that high college dropout rates contributed to loan repayment problems. As is well known, approximately 40 percent of college students drop out of college before finishing their degree. Among low-income students two-thirds don’t complete their degree, with rates also varying across institutions and majors. While the average wage returns to college remain high, for the substantial share of student loan borrowers who drop out of college, the net returns are likely to be small or negative. Returns are also likely to be small for those who attended a set of for-profit institutions. Enrollment at those institutions surged during the recession. While our data don’t allow us to investigate the returns for these groups of students, their especially low loan repayment rates (as reported elsewhere) are consistent with low post-college employment and earnings, suggesting that eventual returns to these educational investments may be low. The increase in defaults and decline in repayment may also reflect a change in the composition of college entrants during the recession, where even those with relatively low, or even negative returns to college, enrolled in order to qualify for grants and loans as a source of income. The individual and macroeconomic implications of growing student debt go well beyond the high default rates and may not have been sufficiently anticipated and understood.
All the users of this information should be aware that this information does not substitute or duplicate the official macroeconomic statistics. These qualitative indicators are compiled on the basis of opinions and expectations of the interviewed economic agents. I would like to be more concrete relate to this point. The Bank of Albania, having the awareness, independence and a certain degree of institutional transparency, and aiming at achieving high professionalism, plays an active and proactive role in the country’s economic development. Economic analysis is under direct function of the monetary policy decision-making process. In essence, the decision-making precedes the medium-term developments, sustaining the maintaining of price stability as the primary policy target drafted and implemented by the Bank of Albania. Profound analysis of the past, present and future developments of the economy contribute to appropriate decision-making. I assure you that building a complete “picture” of the present and the future of an economy is a rather difficult process, not only for an emerging economy, such as that of Albania, but also for the most advanced economies of the world. Economic and financial developments are accompanied by elements of insecurity, which have become, as you already know, dominant in last two years. Making decisions on the future of this already globalised world of economic links, requires professional maturity. Assessing and selecting appropriate and reliable statistical information requires profound intuitive abilities. Making the selected data bank beneficial to the decisionmaking, requires analytical foresight.