The Impact of Consumer Credit Access on Unemployment

Kyle Herkenhoff

No 25187, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Unemployed households' access to unsecured revolving credit more than tripled over the last three decades. This paper analyzes how both cyclical fluctuations and trend increases in credit access impact the business cycle. The main quantitative result is that credit expansions and contractions have contributed to moderately deeper and more protracted recessions over the last 40 years. As more individuals obtained credit from 1977 to 2010, cyclical credit fluctuations affected a larger share of the population and became more important determinants of employment dynamics. Even though business cycles are more volatile, newborns strictly prefer to live in the economy with growing, but fluctuating, access to credit markets.

JEL-codes: E2 E24 J01 J24 J6 J64 (search for similar items in EconPapers)
Date: 2018-10
New Economics Papers: this item is included in nep-lab and nep-mac
Note: LS
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Citations: View citations in EconPapers (21)

Published as Kyle F Herkenhoff, 2019. "The Impact of Consumer Credit Access on Unemployment," The Review of Economic Studies, vol 86(6), pages 2605-2642.

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Related works:
Journal Article: The Impact of Consumer Credit Access on Unemployment (2019)
Working Paper: The Impact of Consumer Credit Access on Unemployment (2014)
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