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First steps out of debt: Attitudes and social identity as predictors of contact by debtors with creditors

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  • Mewse, Avril J.
  • Lea, Stephen E.G.
  • Wrapson, Wendy

Abstract

Questionnaire research was carried out to identify factors that may encourage problem debtors to take the first steps towards getting out of debt. Consumers with debt problems were identified with the aid of creditor organisations and Her Majesty's Court Service for England and Wales. Responses were also sought from non-debtors from the same consumer groups as the debtors. Response rates from debtors were very low, but results confirmed the existence of a group of chronically poor consumers with widespread and long-lasting debt and also confirmed the demographic differences between this group of debtors and non-debtors found in previous research. These debtors showed marked attitudinal differences from non-debtors, with reduced optimism and financial self-esteem, and a less internal economic locus of control. They also showed a distinct social identity, identifying with fellow debtors and feeling stigmatised both generally and personally. Within the debtor group, engagement with creditors was higher in people reporting lower debt levels, but seeking advice was more frequent in those reporting higher debts. Engagement was associated with a stronger attitude of financial self-efficacy and with a perception of the debtor identity as more permeable. Neither demographic nor psychological factors significantly predicted which debtors would seek advice.

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  • Mewse, Avril J. & Lea, Stephen E.G. & Wrapson, Wendy, 2010. "First steps out of debt: Attitudes and social identity as predictors of contact by debtors with creditors," Journal of Economic Psychology, Elsevier, vol. 31(6), pages 1021-1034, December.
    • Handle: RePEc:eee:joepsy:v:31:y:2010:i:6:p:1021-1034
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    4. Rogers, Pablo & Rogers, Dany & Securato, José Roberto, 2015. "Sobre variáveis psicológicas em modelos de application scoring," RAE - Revista de Administração de Empresas, FGV-EAESP Escola de Administração de Empresas de São Paulo (Brazil), vol. 55(1), January.
    5. Laily Dwi Arsyianti & Salina Kassim, 2018. "Financial Prudence through Financial Education: A Conceptual Framework for Financial Inclusion الاحتراز المالي من خلال التعليم المالي: إطار مفاهيمي للإدماج المالي," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 31(1), pages 151-166, January.
    6. Brennan, Linda & Zevallos, Zuleyka & Binney, Wayne, 2011. "Vulnerable consumers and debt: Can social marketing assist?," Australasian marketing journal, Elsevier, vol. 19(3), pages 203-211.
    7. repec:abd:kauiea:v:31:y:2018:i:1:p:151-166 is not listed on IDEAS
    8. Dumitriu, Ramona & Stefanescu, Răzvan, 2020. "Iluzii financiare, Partea întâi [Financial Illusions, Part 1]," MPRA Paper 101201, University Library of Munich, Germany, revised 17 Jun 2020.
    9. Jean Lown & Jinhee Kim & Michael Gutter & Anne-Therese Hunt, 2015. "Self-efficacy and Savings Among Middle and Low Income Households," Journal of Family and Economic Issues, Springer, vol. 36(4), pages 491-502, December.
    10. Aswathi Rebecca Asok & Joe Cox, 2024. "Debt Attitude and Debt Accumulation among Rural Poor Households in a Developing Region: A Q-squared Approach," Working Papers in Economics & Finance 2024-03, University of Portsmouth, Portsmouth Business School, Economics and Finance Subject Group.
    11. M. Gagarina A. & A. Shantseva A. & М. Гагарина А. & А. Шанцева А., 2017. "Социально-психологические особенности и уровень финансовой грамотности должников // Socio-Psychological Peculiarities and Level of Financial Literacy of Russian Debtors," Review of Business and Economics Studies // Review of Business and Economics Studies, Финансовый Университет // Financial University, vol. 5(2), pages 5-22.
    12. M. Gagarina & T. Goroshnikova & М. Гагарина & Т. Горошникова, 2018. "Психологические факторы стратегий погашения множественных задолженностей // Psychological Factors of Multiple Debt Repayment Strategies," Review of Business and Economics Studies // Review of Business and Economics Studies, Финансовый Университет // Financial University, vol. 6(3), pages 57-64.
    13. Lunn, Pete & Julienne, Hannah & Belton, Cameron & Timmons, Shane, 2022. "Understanding Solutions to Problem Debt: An Experimental Investigation," Papers WP726, Economic and Social Research Institute (ESRI).
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