Nudge of shared information responsibilities: a meso-economic perspective of the Italian consumer credit reform

Umberto Filotto (), Caterina Lucarelli and Nicoletta Marinelli
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Umberto Filotto: University of Rome “Tor Vergata”

Mind & Society: Cognitive Studies in Economics and Social Sciences, 2018, vol. 17, issue 1, No 1, 14 pages

Abstract: Abstract Irrational debt decisions at the individual level may harm collective welfare. For this reason, regulators are committed to encourage information-based behaviours in order to enhance likelihood of appropriate indebtedness. We analyse, with a diff-in-diff estimator, the Italian case offered by the Legislative Decree that reformed the consumer credit market adopting European Directive 2008/48/EC, and that reinforced the mandatory information acquisition, jointly asked to lenders and borrowers, before granting/receiving consumer credit. By using micro-data on 60.000 consumer credit borrowers, in total, randomly sampled from the most relevant Italian Credit Bureau, our findings support that, in the medium term, the new consumer credit regulation has improved borrowers’ repayment ability, enhancing the quality of credit distribution. Nevertheless, a simplistic ‘better information-better behaviour’ relationship cannot be assured. This success is likely due to conjunct adaptation of behaviours, with shared responsibilities experienced on both the demand and offer side of the consumer credit marketplace.

Keywords: Consumer credit; Information paradigm; Behavioural biases; Credit register; Repayment ability (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1007/s11299-019-00199-z

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