Population Aging and Convergence of Household Credit

Sever Can ()
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Sever Can: International Monetary Fund, 700 19th Street, N.W. Washington, DC 20431, USA

The B.E. Journal of Macroeconomics, 2023, vol. 23, issue 1, 497-520

Abstract: This paper sheds light on the role of population aging in convergence of household credit. Using data from 32 economies over the period of 1995–2015, it shows that household credit tends to converge across countries over time, but aging populations hinder this convergence process. The result is also robust to controlling for various country-specific factors. Focusing on a further breakdown of credit to households, population aging weakens the convergence process in the case of housing loans, while it does not have a pronounced role in convergence of consumer credit. These findings can have implications for macroeconomic and financial policies, given the potential effects of household credit on economic growth and stability.

Keywords: population aging; household credit; consumer credit; housing loans; mortgage; convergence (search for similar items in EconPapers)
JEL-codes: F30 F37 G10 G20 J11 N20 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1515/bejm-2022-0048

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