BANKRUPTCY AND DELINQUENCY IN A MODEL OF UNSECURED DEBT

• 成果类型: Article
• 署名作者: Athreya, Kartik; Sanchez, Juan M.; Tam, Xuan S.; Young, Eric R.
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Richmond; Federal Reserve System - USA; Federal Reserve Bank - St. Louis; City University of Hong Kong; University of Virginia; Zhejiang University
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12281
• 发表日期: 2018
• 页码: 593-623
• 关键词: quantitative theory; life-cycle; default; credit; RISK; INFORMATION

摘要

This article documents and interprets a fact central to the dynamics of informal consumer debt default. We observe that for individuals 60- 90 days late on payments, (i) 85% make payments during the next quarter, and (ii) 40% reduce their debt. To understand these facts, we develop a quantitative model of debt delinquency and bankruptcy. Our model reproduces the dynamics of delinquency and suggests an interpretation of the data in which lenders frequently reset loan terms for delinquent borrowers, typically offering partial debt forgiveness, instead of a blanket imposition of the penalty rates most unsecured credit contracts specify.