Stress testing the household sector in Mongolia

Gan-Ochir Doojav () and Ariun-Erdene Bayarjargal
Additional contact information
Ariun-Erdene Bayarjargal: Ardnt-Corden Department of Economics, Australian National University, 132 Lennox Crossing ACT 2601, Australia

Asia-Pacific Development Journal, 2017, vol. 24, issue 2, 23-52

Abstract: The present paper contains an outline of a simulation-model for stress testing the household sector in Mongolia. The model uses data from the Household Socio-Economic Survey to assess the financial resilience of the household sector to macroeconomic shocks. The results suggest that the household sector of Mongolia is vulnerable to shocks associated with interest rates, cost of basic consumption, asset prices and unemployment. In particular, impacts of interest and consumer price shocks on household’s debt at risk (or expected loan losses) are considerable. Furthermore, it has been found that a substantial increase in household indebtedness has boosted the financial fragility of the household sector. Those results have important policy implications in mitigating the increasing financial fragility of the household sector and risks to financial stability.

Keywords: Stress testing; household indebtedness; household surveys; Mongolia (search for similar items in EconPapers)
JEL-codes: C15 D14 D31 E17 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.unescap.org/sites/default/files/APDJ%20chapter%202.pdf (application/pdf)

Related works:
Working Paper: Stress testing the household sector in Mongolia (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:unt:jnapdj:v:24:y:2017:i:2:p:23-52

Access Statistics for this article

More articles in Asia-Pacific Development Journal from United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) Contact information at EDIRC.
Bibliographic data for series maintained by Macroeconomic Policy and Development Division, ESCAP ().