The Boston Globe writes about a creative way to help students pay their college bills:

The result is an innovative way to think about paying for higher education. The idea, sometimes called human capital contracts, is that investors agree to cover the costs of college or graduate school in return for a percentage of the students’ future earnings over a fixed period of time. Since payments are scaled to wages, the odds of default – and of financial hardship for the graduate – are greatly reduced. This scheme transfers much of the risk from students to investors. But if the students earn handsomely, the investors stand to gain more than they would under a traditional loan.

Several months ago, Kevin Carey and Frederick M. Hess made the case in The American. Before reading the Globe piece, however, I didn’t fully appreciate the proposal’s connection to Milton Friedman. In the future, I may assume that all good ideas started with Milton Friedman, just to be on the safe side.