US and European Household Debt and Credit Constraints

Crook, Jonathan; Hochguertel, Stefan

doi:10.2139/ssrn.1036002

Cited by 25 publications

(21 citation statements)

References 53 publications

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“…In the model, income and asset accumulation are correlated, which is consistent with Saez (2002), who argues that there is a positive correlation between the labor skill level and the saving rate. In addition, the proposed model is consistent with recent empirical results about credit constraints in the United States showing that wealth and age reduce the chance of being credit constrained (Crook and Hochguertel 2007). Finally, changes in consumption behavior over the life cycle reflect empirical evidence (see Gourinchas and Parker 2002).…”

Section: Abstract Optimal Taxation Life Cycle Income Mobility Borrsupporting

confidence: 84%

Optimal Taxation and Income Mobility with Borrowing Limits

Mathieu-Bolh

2011

Public Finance Review

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The author studies age-dependent optimal taxation in an environment that takes into consideration changes in consumption behavior over the life cycle due to changes in labor income paths and borrowing limits. Income mobility is defined as an exogenous rate at which individuals change from a low-to a high-income path. In this framework, the role of age-dependent income taxation is reinforced. Consumption and leisure optimal allocations are not constant over the life cycle even when preferences are additively separable. As a result, age-dependent optimal capital income taxation faced by high-income earners differs from zero for all forms of preferences. In addition, past environments used to study optimal taxation appear as special cases of the proposed model. When the rate of income mobility is infinite, the proposed model nests the simple finite horizon framework. When life expectancy is infinite, the model nests the infinite horizon framework.

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Section: Abstract Optimal Taxation Life Cycle Income Mobility Borrsupporting

confidence: 84%

Optimal Taxation and Income Mobility with Borrowing Limits

Mathieu-Bolh

2011

Public Finance Review

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“…This has been found to be the case for mature households (Christelis et al (2012)), for debt (Crook and Hochguertel (2007)) and for stockholding (Guiso et al (2003)). …”

Section: Introductionmentioning

confidence: 81%

To Own or Not to Own? Household Portfolios, Demographics and Institutions in a Cross-National Perspective

Sierminska

Doorley

2013

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Using harmonized wealth data and a novel decomposition approach, we show that cohort effects exist in the income profiles of asset and debt portfolios for a sample of European countries, the U.S. and Canada. We find that younger households' participation decisions in assets are more responsive to income than older households. Family structure plays a significant role in explaining cross-country differences for both cohorts. Examining institutional differences, we find that in more financially developed and economically open countries, households are less likely to own housing but more likely to be in debt. Typical mortgage characteristics and mathematical literacy are also correlated with debt participation across countries. These findings have important implications for policy setting during times of financial unease for the young, as well as for the future in helping secure adequate income for the elderly. Our results show that there is scope for policies which promote asset participation for young households and debt participation, where there is a need for consumpation smoothing, for older households. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SJEL Classification: G11, G21, J10

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“…These crises could have contributed to the situation that some households came up against huge debt responsibilities. In many member countries of the Organisation for Economic and Co-operation and Development (OECD), households have faced considerably high levels of debt (Crook & Hochguertel, 2007).…”

Section: Domestic Economic Situationmentioning

confidence: 99%

Spouses' views of gender roles: financial management in marriage

Alsemgeest

Grobbelaar

2015

J. econ. financ. sci.

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Arguments about money represent one of the most common reasons for divorce. South African and several Western cultures consider communication about money as uncivil and taboo -even more so than sex and death. The aim of this investigation is to determine newly married couples' views of gender roles in marriage with regard to financial management. Various factors can lead to personal financial problems and marital problems, namely financial illiteracy, financial phobia, low income, an excessive standard of living, compulsive buying and indebtedness. In general, men are more confident with regard to financial management, a phenomenon that is also confirmed by the results of this study. This was a quantitative study and questionnaires were distributed amongst couples that have been married for less than 10 years. Both spouses had to complete a questionnaire, and in order to ensure frankness they were requested not to share their answers with each other. The results show that both genders consider men to be superior concerning financial behaviour. The women indicated that they are not as self-confident with regard to their own ability and knowledge of financial management, despite major advances in the empowerment of women and the fact that many women are breadwinners in their homes. The indication by men that they have little faith in their wives' abilities to discern between luxuries and essentials was statistically significant. The sensitivity of the topic was once again emphasised by, in particular, the strong reaction from men about the completion of the questionnaires. Future research in this domain is essential, but it is recommended that anonymity be regarded as a critical point in gaining a larger response rate.

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US and European Household Debt and Credit Constraints

Cited by 25 publications

References 53 publications

Optimal Taxation and Income Mobility with Borrowing Limits

Optimal Taxation and Income Mobility with Borrowing Limits

To Own or Not to Own? Household Portfolios, Demographics and Institutions in a Cross-National Perspective

Spouses' views of gender roles: financial management in marriage

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