Persistency of financial distress amongst Italian households: Evidence from dynamic models for binary panel data

Giarda, Elena

doi:10.1016/j.jbankfin.2013.05.005

Cited by 50 publications

(47 citation statements)

References 26 publications

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“…The coefficient of state dependence of Wooldridge is the lowest one compared with its peers in the other two models. This corroborates previous findings that the assumption of the exogeneity of the initial conditions (in the random-effects probit estimation) tends to overestimate the coefficient of the lagged-dependent variable, hereinafter the diversification indicator (Giarda, 2013).…”

Section: Resultssupporting

confidence: 90%

What drives the banks' diversification decision? A dynamic nonlinear panel data approach

Ammar

Boughrara

2019

Manage Decis Econ

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This paper empirically determines the drivers of functional diversification decision for 365 banks set in selected Middle East and North Africa (MENA) countries over 1988–2015. For this purpose, we use a dynamic nonlinear panel data model. Our findings reveal that both market share and financial intermediation stratify the diversification decision for the whole MENA sample. Splitting the sample shows that the risk‐adjusted profitability and the loan loss provision ratio exert a major influence over the diversification indicator for Gulf Cooperation Council (GCC) banks, whereas the net interest margin ratio, the bank market share, and financial intermediation are the major drivers of the strategic decision for the remaining non‐GCC banks.

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Section: Resultssupporting

confidence: 90%

What drives the banks' diversification decision? A dynamic nonlinear panel data approach

Ammar

Boughrara

2019

Manage Decis Econ

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“…It is apparent from the results that having a male head of household is negatively associated with the probability of experiencing difficulties paying for accommodation, as well as the probability of experiencing financial problems related to paying for heating, an annual holiday, clothes and entertaining friends or family on a monthly basis. This finding is consistent with Giarda (2013) where having a female head potentially exposes the household to higher levels of financial distress. Having a white head of household, on the other hand, is inversely related to the probability of experiencing problems with loan repayments as well as experiencing problems with affording an annual holiday or replacing worn-out furniture.…”

Section: Financial Problems and Demographic Characteristicssupporting

confidence: 88%

The existence and persistence of household financial hardship: A Bayesian multivariate dynamic logit framework

Brown

Ghosh

Taylor

2014

Journal of Banking & Finance

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Abstract:We investigate the existence and persistence of financial hardship at the household level using data from the British Household Panel Survey. Our modelling strategy makes three important contributions to the existing literature on household finances. Firstly, we model nine different types of household financial problems within a joint framework, allowing for correlation in the random effects across the nine equations. Secondly, we develop a dynamic framework in order to model the persistence of financial problems over time by extending our multi-equation framework to allow the presence or otherwise of different types of financial problems in the previous time period to influence the probability that the household currently experiences such problems. Our third contribution relates to the possibility that experiencing financial problems may be correlated with sample attrition. Hence, we explicitly model missing observations in the panel in order to allow for such attrition. Our modelling framework allows us to identify any persistence in financial problems over time as well as any interdependence that may exist between different types of financial problems. The results reveal interesting variations in the determinants of experiencing different types of financial problems including demographic and regional differences. Our findings also highlight persistence in experiencing financial problems over time as well as the role that saving on a regular basis can play in mitigating financial problems.

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“…For household disposable income, we divided disposable income by the number of household members (per capita) and transformed it into a natural logarithm, to reduce the variability of the data and make it conform more closely to the normal distribution. Detailed description on explanatory variables presents in the Table 1. [INSERT (Giarda, 2013;Heckman, 1981a). This model has advantages in addressing the issues surrounding the panel data such as sample attrition and explanatory variables that change in value over the observational period (Allison, 1982).…”

Section: Explanatory Variablesmentioning

confidence: 99%

Dynamics of Asset Poverty in South Korea

Weon¹,

Rothwell²

2017

Preprint

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Following the Asian Financial Crisis of 1997, Korea has suffered what many consider to be a severe poverty problem. Despite policy efforts to reduce poverty and economic recovery in the early 2000s, poverty affects many households and certain households are at risk of staying in poverty once they are in it. Using longitudinal panel data from 2005 to 2014, this study defines three indicators of poverty based on asset holdings, rather than income. It then examines the dynamics of asset poverty in Korea across the study period. The study's primary goal is to reveal differences across the three indicators and identify which groups of poor people in Korea have been structurally trapped in poverty. We applied a dynamic panel model of discrete choice to the Korean Welfare Panel Study (KOWEPS) from the 1 st to 10 th waves and show that, despite the indicator, the asset poor who experienced asset poverty in the previous surveyed year or at wave 1 are likely to fall into structural and persistent poverty over time. In addition, the probability of incurring asset poverty decreased with home ownership, higher disposable income, and greater diversification of the household portfolio. Future research should study the duration of asset poverty to complete a comprehensive picture of the asset poverty condition.

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Persistency of financial distress amongst Italian households: Evidence from dynamic models for binary panel data

Cited by 50 publications

References 26 publications

What drives the banks' diversification decision? A dynamic nonlinear panel data approach

What drives the banks' diversification decision? A dynamic nonlinear panel data approach

The existence and persistence of household financial hardship: A Bayesian multivariate dynamic logit framework

Dynamics of Asset Poverty in South Korea

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