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Attitudes towards Debt and Debt Behavior

Author

Listed:
  • Johan Almenberg
  • Annamaria Lusardi
  • Jenny Säve‐Söderbergh
  • Roine Vestman

Abstract

We introduce a novel survey measure of attitude towards debt. Matching our survey results with panel data on Swedish household balance sheets from registry data, we show that our measure of debt attitude helps to explain individual variation in indebtedness as well as debt build‐up and spending behavior in the period 2004–2007. As an explanatory variable, debt attitude compares well with a number of other determinants of debt, including education, risk‐taking, and financial literacy. We also provide evidence that suggests that debt attitude is passed down along family lines and has a cultural element.

Suggested Citation

  • Johan Almenberg & Annamaria Lusardi & Jenny Säve‐Söderbergh & Roine Vestman, 2021. "Attitudes towards Debt and Debt Behavior," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(3), pages 780-809, July.
    • Handle: RePEc:bla:scandj:v:123:y:2021:i:3:p:780-809
    DOI: 10.1111/sjoe.12419
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    More about this item

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth

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