EconPapers    
Economics at your fingertips  
 

Debts on debts

Joao Faria (), Le Wang () and Zhongmin Wu ()

NBS Discussion Papers in Economics from Economics, Nottingham Business School, Nottingham Trent University

Abstract: This paper studies the impact of mortgages on consumer debt and on debt on durable goods. We first present a stylized model in which an outstanding debt, representing mortgages, affects positively consumer debt, and debt on durable goods. The model is empirically tested for the U.S. using PSID 2005 wave. Our results are striking. First, we find strong evidence supporting a positive association between mortgage loans and consumer debts, regardless of the measures used, the control variables used, and the methods used. Second, we find that the effects of mortgages on the debt on durable goods are in general smaller than the effects of mortgages on consumer debt. Third, our distributional analysis reveals that the effects monotonically decrease as the quantile increases. Finally, our results are also confirmed by the results using the U.K. data.

Keywords: Consumer expenditure; housing; credit; censored regressions (search for similar items in EconPapers)
JEL-codes: G21 E44 R21 R31 (search for similar items in EconPapers)
Date: 2009-12
New Economics Papers: this item is included in nep-ban and nep-ure
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.ntu.ac.uk/__data/assets/pdf_file/0011/310250/debts-on-debts.pdf First version, 2009 (application/pdf)

Related works:
Journal Article: Debts on debts (2012) Downloads
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:nbs:wpaper:2009/7

Access Statistics for this paper

More papers in NBS Discussion Papers in Economics from Economics, Nottingham Business School, Nottingham Trent University
Bibliographic data for series maintained by King Lim ().

 
Page updated 2020-02-23
Handle: RePEc:nbs:wpaper:2009/7