 Restricting consumer credit access: Household survey evidence on effects around the Oregon rate capJournal of Banking & Finance, 2010, vol. 34, issue 3, 546-556 Abstract: Many policymakers and some theories hold that restricting access to expensive credit helps consumers by preventing overborrowing. I examine some effects of restricting access, using household panel survey data on payday loan users collected around the introduction of binding restrictions on payday loan terms in Oregon. Borrowing fell in Oregon relative to Washington, with former payday borrowers shifting partially into plausibly inferior substitutes: bank overdrafts and late bill payment. Additional evidence suggests that restricting access caused deterioration in the overall financial condition of Oregon households. Overall the results are consistent with restricted access harming, not helping, consumers on average. Keywords: Payday; loan; Subprime; credit; market; Predatory; lending; Usury; Interest; rate; ceiling; Behavioral; economics; Psychology; and; economics; Household; finance; Consumer; finance; Behavioral; finance (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:34:y:2010:i:3:p:546-556 Access Statistics for this article Journal of Banking & Finance is currently edited by Ike Mathur More articles in Journal of Banking & Finance from Elsevier |
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