Credit Card Debt and Consumer Payment Choice: What Can We Learn from Credit Bureau Data?
Joanna Stavins ()
Journal of Financial Services Research, 2020, vol. 58, issue 1, No 4, 59-90
Abstract We estimate a two-stage Heckman selection model of credit card adoption and use with a unique dataset that combines administrative data from the Equifax credit bureau and self-reported data from a representative survey of consumers. Higher-income consumers carry higher credit card balances, but they tend to repay those balances each month. Credit card revolvers have lower income and are less educated. Revolvers are twice as likely to use debit cards as credit cards for payments, but they carry much higher balances on their credit cards. The high cost of paying off credit card debt likely exacerbates existing inequalities in disposable income. Unlike the mortgage market, we find no evidence for lenders’ cutoff between subprime and prime consumers in the credit card market.
Keywords: Credit card debt; Consumer payments; Consumer preferences; D14; E21; G21 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
http://link.springer.com/10.1007/s10693-019-00330-8 Abstract (text/html)
Access to the full text of the articles in this series is restricted.
Working Paper: Credit card debt and consumer payment choice: what can we learn from credit bureau data? (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:kap:jfsres:v:58:y:2020:i:1:d:10.1007_s10693-019-00330-8
Ordering information: This journal article can be ordered from
Access Statistics for this article
Journal of Financial Services Research is currently edited by Haluk Unal
More articles in Journal of Financial Services Research from Springer, Western Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().