Fines and Financial Wellbeing

• 成果类型: Article
• 署名作者: Mello, Steven
• 署名单位: Dartmouth College; National Bureau of Economic Research
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdae111
• 发表日期: 2025
• 页码: 3340-3374
• 关键词: consumption evidence; consumer bankruptcy; CONSEQUENCES; debt; LIFE; job

摘要

While survey evidence suggests widespread financial fragility in the U.S., causal evidence on the implications of typical, negative income shocks is scarce. I estimate the impact of speeding fines on household finances using administrative traffic citation records and a panel of credit reports. Event studies reveal that fines averaging $195 are associated with a $34 increase in unpaid bills in collections. Given additional evidence that fine payment explains this effect and that default is the last resort for households, I interpret this finding as suggesting rates of inability to meet unplanned expenses which are consistent with the survey evidence. I also find that fines are associated with longer-run declines in credit scores, borrowing limits, and the likelihood of appearing as employed in payroll records covering a subset of large, high-paying employers. This impact on employment situations appears attributable to the diminished financial position of households rather than, e.g. downstream license suspensions.