Household Debt and Local Public Finances

Consumer Credit and Household Finances

In the 1990s, borrowing by households has grown quickly. In the early part of the decade, the growth was driven by housing lending (Graph␣ 1). More recently, growth in other personal borrowings has picked up sharply. particularly the widespread introduction of loan products enabling households to draw on equity in their owner-occupied property. This type of loan gives explicit recognition, in t...

Household debt and social interactions

Debt-induced crises, including the subprime, are usually attributed exclusively to supply-side factors. We examine the role of social influences on debt culture, emanating from perceived average income of peers. Utilizing unique information from a household survey representative of the Dutch population, that circumvents the issue of defining the social circle, we consider collateralized, consum...

Income Inequality and Household Debt

Future changes in age and household patterns: Some implications for public finances

Using stochastic forecasting techniques, this paper assesses the consequences for public finances of changes in age and household structures in Denmark over the period 2008–2037. Focusing on components of welfare provisions and tax payments with noticeable differences across age and household status, we show that, based on a point forecast, the fiscal impact of changes in household structures a...

Local Public Investment and Debt Limitation in a Federation

The paper considers the local provision of public infrastructure when population is mobile. It shows that inflexible deficit limitation may result in too little local public investment if population is perfectly mobile in the long run. Conversely, given the existence of migration externalities, implementing Musgrave's pay as you use finance, according to which new debt should match net investme...