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The determinants of Greek household indebtedness and financial stress

Author

Listed:
  • Theodoros M. Mitrakos

    (Bank of Greece)

  • George T. Simigiannis

    (Special Advisor to the Bank of Greece)

Abstract

The paper uses data from the household survey conducted by the Bank of Greece in 2007 and investigates how various socioeconomic characteristics of households, such as income and wealth, household size, the age, education level and tenure of employment of the household head, are related with the probability of having a loan, the distribution of the financial stress as is measured by the debt service cost to income ratio, and also with the proper or not servicing of their loans. Most of the characteristics examined were found to be associated with the household’s probability of having a loan. Financial stress tends to decline as household income and net wealth increase, while certain household characteristics were also found to affect households’ capacity to service properly their debt obligations.

Suggested Citation

  • Theodoros M. Mitrakos & George T. Simigiannis, 2009. "The determinants of Greek household indebtedness and financial stress," Economic Bulletin, Bank of Greece, issue 32, pages 7-26, May.
    • Handle: RePEc:bog:econbl:y:2009:i:32:p:7-26
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    File URL: https://www.bankofgreece.gr/BogEkdoseis/econbull200909.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    household indebtedness; debt service;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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