Too Much of a Good Thing? Households' Macroeconomic Conditions and Credit Dynamics

Martin Hodula, Simona Malovana and Jan Frait (jan.frait@cnb.cz)

Working Papers from Czech National Bank, Research and Statistics Department

Abstract: We focus on the link between the macroeconomic conditions faced by households, the confidence of households as investors and consumers, and households' demand for credit. On a sample of 21 OECD countries, we provide empirical evidence that links households' macroeconomic conditions to the evolution of credit. Specifically, we find that: (i) the well-known procyclicality of credit is reinforced in periods of favorable macroeconomic conditions; (ii) the relationship in question grows stronger when good macro conditions are met with optimistic consumer confidence; (iii) household credit is sticky on the way down, while it goes hand in hand with the improving economy during an economic upturn.

Keywords: Credit; households; macroeconomic conditions; panel data (search for similar items in EconPapers)
JEL-codes: F12 F41 F43 (search for similar items in EconPapers)
Date: 2019-12
New Economics Papers: this item is included in nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Too much of a good thing? Households’ macroeconomic conditions and credit dynamics (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:cnb:wpaper:2019/11

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