Just as Wall Street investors use a price-to-earnings ratio to evaluate the value of individual stocks, consumers and lawmakers should similarly be able to assess the return that an individual institution provides to its students before they decide to write huge checks. To capture this sentiment, this paper models a new approach for measuring economic value—a Price-to-Earnings Premium (PEP)—that can be used to get a sense of the amount of time it usually takes to recoup the cost of obtaining a credential at a particular school.

This report examines the differences in loan repayment rates for different slices of student borrowers: those who complete an award or degree and those who never finish.