Household debt during the financial crisis: micro-evidence from Chile
Author
dc.contributor.author
Álvarez Espinoza, Roberto
Author
dc.contributor.author
Opazo, Luis
es_CL
Admission date
dc.date.accessioned
2014-12-11T20:09:04Z
Available date
dc.date.available
2014-12-11T20:09:04Z
Publication date
dc.date.issued
2013-04
Identifier
dc.identifier.uri
https://repositorio.uchile.cl/handle/2250/122755
Abstract
dc.description.abstract
We examine evidence from a 2006 to 2009 data panel to explore how Chilean
households were affected by the negative income shock observed during the recent
financial crisis. Our results show that there is a negative and significant relationship
between income shocks and changes in consumption debt. This suggests that
increasing debt allowed households to smooth consumption during the financial crisis
and provides new empirical evidence of the importance of financial constraints in a
developing economy. We find evidence of heterogeneous effects by type of
consumption debt and across households. Our results show that income loss increased
indebtedness with banking institutions, but not with non-banking creditors. Across
households, these results are driven mainly by those with financial assets and low
levels of indebtedness before the crisis.
en_US
Lenguage
dc.language.iso
en_US
en_US
Publisher
dc.publisher
Universidad de Chile, Facultad de Economía y Negocios