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Macroeconomic factors, consumer behavior, and bankcard default rates

Macroeconomic factors, consumer behavior, and bankcard default rates Over the period from 1981 through 1999, we investigate the relationship between bankcard delinquencies and key macroeconomic variables. Changes in the proportion of accounts in default are statistically related to the consumer debt ratio. When the delinquency rate is calculated based on the number of dollars outstanding, it is related to the total amount of revolving debt. We also find evidence consistent with a pattern of selective default behavior, in which consumers will default on bankcard debt before defaulting on other types of installment loans. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Economics and Finance Springer Journals

Macroeconomic factors, consumer behavior, and bankcard default rates

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References (8)

Publisher
Springer Journals
Copyright
Copyright © Academy of Economics and Finance 2001
ISSN
1055-0925
eISSN
1938-9744
DOI
10.1007/bf02745892
Publisher site
See Article on Publisher Site

Abstract

Over the period from 1981 through 1999, we investigate the relationship between bankcard delinquencies and key macroeconomic variables. Changes in the proportion of accounts in default are statistically related to the consumer debt ratio. When the delinquency rate is calculated based on the number of dollars outstanding, it is related to the total amount of revolving debt. We also find evidence consistent with a pattern of selective default behavior, in which consumers will default on bankcard debt before defaulting on other types of installment loans.

Journal

Journal of Economics and Finance – Springer Journals

Published: Sep 1, 2001

Keywords: Unit Root; Credit Card; Percent Level; Default Rate; Consumer Credit

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