Human capital contracts have been advocated by a number of Nobel Prize–winning economists, including Milton Friedman, Robert Merton, and Gary Becker.
[4] In the 1970s, Yale University attempted to replace traditional student loans with human capital contracts under its "Tuition Postponement Option", a program designed by economists Milton Friedman and James Tobin.
[6] Recently, a number of companies have begun to attempt to commercially underwrite human capital contracts for the first time, including some that are not focused on funding a student population.
[15] In comparing the merits of human capital contracts with loans, proponents have noted that providers of HCCs are better aligned with the financial interests of the receiver of the funds, and the stream of payments required should be relatively more affordable to individuals who experience adverse economic events such as unemployment or other decreases in disposable income.
[17] However work is underway in the UK to combine the benefits of human capital contracts with the legal framework developed for loans under the Consumer Credit Act.