Household Debt and Social Interactions

• 成果类型: Article
• 署名作者: Georgarakos, Dimitris; Haliassos, Michael; Pasini, Giacomo
• 署名单位: Goethe University Frankfurt; University of Leicester; Centre for Economic Policy Research - UK; Universita Ca Foscari Venezia
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhu014
• 发表日期: 2014
• 页码: 1404
• 关键词: Consumption externalities; discrete-choice; habit formation; identification; MODEL

摘要

Can concern with relative standing, which has been shown to influence consumption and labor supply, also increase borrowing and the likelihood of financial distress? We find that perceived peer income contributes to debt and the likelihood of financial distress among those who consider themselves poorer than their peers. We use unique responses describing perceived peer characteristics from a Dutch population-wide survey to handle two major challenges of uncovering social interaction effects on borrowing: (1) debts, unlike conspicuous consumption, are often hidden from peers and (1) location is missing in anonymized data. We employ several approaches to uncover exogenous, rather than correlated, effects.