Arbeitspapier
Debt overhang and deleveraging in the US household sector: gauging the impact on consumption
Using a novel dataset for the US states, this paper examines whether household debt and the protracted debt deleveraging help explain the dismal performance of US consumption since 2007 in the aftermath of the housing bubble. By separating the concepts of deleveraging and debt overhang - a flow and a stock effect - we find that excessive indebtedness exerted a meaningful drag on consumption over and beyond income and wealth effects. The overall impact, however, is modest - around one-sixth of the slowdown in consumption between 2000-06 and 2007-12 - and mostly driven by states with particularly large imbalances in their household sector. This might be indicative of non-linearities, whereby indebtedness begins to bite only when misalignments from sustainable debt dynamics become excessive.
- ISBN
-
978-92-899-1656-1
- Sprache
-
Englisch
- Erschienen in
-
Series: ECB Working Paper ; No. 1843
- Klassifikation
-
Wirtschaft
Estimation: General
Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
Model Evaluation, Validation, and Selection
Consumer Economics: Empirical Analysis
Fiscal Policies and Behavior of Economic Agents: Household
- Thema
-
Consumption function
Debt overhang
Household deleveraging
Housing wealth
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Albuquerque, Bruno
Krustev, Georgi
- Ereignis
-
Veröffentlichung
- (wer)
-
European Central Bank (ECB)
- (wo)
-
Frankfurt a. M.
- (wann)
-
2015
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Albuquerque, Bruno
- Krustev, Georgi
- European Central Bank (ECB)
Entstanden
- 2015
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