Home Equity Lending and Retail Spending: Evidence from a Natural Experiment in Texas

• 成果类型: Article
• 署名作者: Abdallah, Chadi S.; Lastrapes, William D.
• 署名单位: University System of Ohio; Miami University; University System of Georgia; University of Georgia
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.4.4.94
• 发表日期: 2012
• 页码: 94-125
• 关键词: liquidity constraints; house prices; interest-rates; consumption; credit; income; tax

摘要

We estimate how spending in Texas responded to a 1997 constitutional amendment that relaxed severe restrictions on home equity lending. We use this event as a natural experiment to estimate the importance of credit constraints. If households are credit-constrained, such an increase in credit availability will increase their spending. We find that Texas retail sales at the county and state levels increased significantly after the amendment, lending support to the credit-constraint hypothesis. We confirm these findings and refine our interpretation of the estimated aggregate-level responses using household-level data on home equity loans. (JEL D14, E21, G21, G28)