Credit Cards and the Receipt of Financial Assistance from Friends and Family

Campbell, Colin; Pugliese, Maude

doi:10.1007/s10834-021-09751-x

Cited by 9 publications

(11 citation statements)

References 73 publications

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“…We suspect that one reason for this discrepancy, however, may be a result of the limitations of NLSY97's measurement that only asks about personal debt greater than $1,000. Another possibility is that increased access to other debts leads some to prefer these more impersonal types of debt relative to personal debts and the obligations and burdens these may entail (Campbell & Pugliese, 2021).…”

Section: Resultsmentioning

confidence: 99%

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood^*

2021

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Social exclusion of those with criminal justice experience increasingly includes a financial component, but the structure of disadvantage in credit and debt remains unclear. We develop a model of financial disadvantage in debt holding during the transition to adulthood among justice‐involved groups. We study cumulative criminal justice contact and debt holding by age 30 using the National Longitudinal Survey of Youth 1997 (NLSY97). The NLSY97 cohort transitioned to adulthood during an era of historically high criminal justice contact, with many experiencing arrests, convictions, and incarceration. We develop a distinct measurement approach to cumulative criminal justice contact by age 30 that captures variation between young adults in the severity of justice encounters in the early life course. We conceptualize financial disadvantage as a lower likelihood of holding debt that facilitates property and attainment investments and a higher likelihood of holding higher cost debts used for consumption or emergencies. We find that those with the most punitive criminal justice contact evidence the most disadvantageous form of debt holding, potentially exacerbating social exclusion. We consider the implications of the accumulation of financial disadvantage for our understanding of criminal justice contact as a life‐course process.

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Section: Resultsmentioning

confidence: 99%

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood^*

2021

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“…Finally, it is worth noting that this study focused on problematic use of credit cards among college students. Most students are responsible with credit (Robb et al, 2012 ) and the proper use of credit can allow such students increased financial freedom (Campbell & Pugliese, 2021 ). Future research should examine predictors and correlates of positive credit use as well.…”

Section: Discussionmentioning

confidence: 99%

“…According to Tenenhaus et al ( 2004 ), structural equation modeling (SEM) allows the simultaneous statistical regression of a group of equations that are different from one another, which enables the relationship between latent variables (non-observable) and their indicators (observable) to be checked. Based on the argument that young adults' credit card usage might also be influenced by their community and societal level elements such as friends, classmates, and others, or even by commercial banks, we tested a structural model used by Braun Santos et al ( 2016 ), in order to consider different aspects concerning credit card usage and financial well-being in three different countries (Campbell & Pugliese, 2021 ; Gonçalves, et al, 2021 ; Ming et al, 2021 ; Sotiropoulos & d'Astous, 2013 ). The present study tested a model of structural equations that considers financial well-being, as a function of credit card use behavior, social financial comparison, self-confidence in financial management, and the financial education passed on to young people by their parents.…”

Section: Introductionmentioning

confidence: 99%

Parents Influence Responsible Credit Use in Young Adults: Empirical Evidence from the United States, France, and Brazil

et al. 2021

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From the start of adulthood, consumers are frequently faced with complex financial decisions, and the consequences of these decisions may be reflected throughout the rest of their lives. As access to credit has expanded among college students around the world, it is critical that we understand both universal and culture-specific processes. Although some work has examined credit card use in two cultures simultaneously, there is, to our knowledge, no research examining such use in three cultures on three continents and across both genders. This study analyzes credit card use behavior among 1458 young adults living either in Brazil, the United States, or France. A structural equations model is used to incorporate relationships between the latent variables. The model, which was validated by the study, examines how financial well-being is affected by the way in which the individual uses credit cards, which in its turn is affected by social comparison and by financial self-confidence, the latter being also impacted by the financial education received from the parents. In the comparison between groups we found evidence that men are more dependent on parental education than women.

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“…In their year-long study of the financial activity of more than 200 American households, Morduch and Schneider (2017) reported that 40 percent of respondents borrowed from friends or family and that people borrowed this way even when they had access to market options, such as a credit card. In a national sample of low- and middle-income mothers, Campbell and Pugilese (2022) find interpersonal borrowing remains a common occurrence even among households that report having a credit card. Although the motivation for borrowing may at times look different among the poor and the rich, people of all socioeconomic stripes turn to social relations for money even when they have alternative options in the market (McGarry and Schoeni 1995; Schoeni 1997).…”

Section: Introductionmentioning

confidence: 91%

“…Yet households today increasingly have the option to satisfy borrowing needs via the market: consider that in 1970, only 16 percent of U.S. families had a general-use credit card, whereas today, some 80 percent do (Foster, Greene, and Stavins 2018; see Fligstein and Goldstein 2015). Despite this “democratization of credit” (Kiviat 2019; Manning 2000), borrowing from social relations remains common, and many households, even more affluent ones, continue to report using both market and interpersonal options (Campbell and Pugilese 2022; Morduch and Schneider 2017; Schoeni 1997).…”

mentioning

confidence: 99%

Deciding between Domains: How Borrowers Weigh Market and Interpersonal Options

2022

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Individuals routinely satisfy borrowing needs by transacting in the market or by relying on social relations. In the market domain, price logic leads borrowers to choose the cheaper option; in the interpersonal domain, role-matching logic leads borrowers to choose the relation best matched to the act. But how do individuals choose when faced with options from each domain? Drawing on theories in economic sociology that assert the economic and the social are mutually constitutive, we posit that when market and interpersonal options appear in the same choice set, the characteristics of one option inflect how people assess the other. Through two survey experiments, we show that price sensitivity toward the market option is less when the interpersonal option is role mismatched and that concerns about interpersonal borrowing changing or damaging the relationship attenuate when the market option is expensive. We discuss the implications for studies of stratification and financial decision-making.

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Credit Cards and the Receipt of Financial Assistance from Friends and Family

Cited by 9 publications

References 73 publications

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood^*

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood^*

Parents Influence Responsible Credit Use in Young Adults: Empirical Evidence from the United States, France, and Brazil

Deciding between Domains: How Borrowers Weigh Market and Interpersonal Options

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Credit Cards and the Receipt of Financial Assistance from Friends and Family

Cited by 9 publications

References 73 publications

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood*

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood*

Parents Influence Responsible Credit Use in Young Adults: Empirical Evidence from the United States, France, and Brazil

Deciding between Domains: How Borrowers Weigh Market and Interpersonal Options

Contact Info

Product

Resources

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The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood^*

The accumulation of disadvantage: Criminal justice contact, credit, and debt in the transition to adulthood^*