The Impact Mechanism of Household Financial Debt on Physical Health in China

Jiru Song, Mingzheng Hu, Shaojie Li and Xin Ye ()
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Jiru Song: School of Statistics, Shandong University of Finance and Economics, Jinan 250002, China
Mingzheng Hu: China Center for Health Development Studies, Peking University, Beijing 100191, China
Shaojie Li: China Center for Health Development Studies, Peking University, Beijing 100191, China
Xin Ye: Institute for Global Public Policy, LSE-Fudan Research Centre for Global Public Policy, Fudan University, Shanghai 200433, China

IJERPH, 2023, vol. 20, issue 5, 1-13

Abstract: In recent years, Chinese household financial debt has been growing rapidly due to the expansion of mortgage lending. This study aims to examine the impact mechanism of Chinese household financial debt on physical health. Using the 2010–2018 China Household Tracking Survey (CFPS) panel data, we developed fixed effects models to explore the effect of household financial debt on individuals’ psychical health, and we also used an instrumental variable to address endogeneity. The findings suggest that there is a negative effect of household financial debt on physical health and these findings still hold after a series of robustness tests. In addition, household financial debt can affect individuals’ physical health through mediating variables, such as healthcare behaviors and mental health, and the effects are more significant for those who are middle-aged, married, and with low-income levels. The findings of this paper are important for developing countries to clarify the relationship between household financial debt and population health, and to develop appropriate health intervention policies for highly indebted households.

Keywords: household financial debt; physical health; China; developing countries; mechanism (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2023
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