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Patterns of debt possession among households in Poland – a multi-group latent class approach

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  • Piotr Białowolski

    (Warsaw School of Economics, Institute of Statistics and Demography
    University of Milan, Department of Economics,Management and Quantitative Methods)

Abstract

In this paper, we evaluated patterns of debt possession among households in Poland by applying multi-group latent class models (MGLCM). Households’ debt was investigated from the perspective of value, motive and source. MGLCM were used to conduct a segmentation of households with respect to debt possession and to determine the factors that influence segment membership. With data from the Social Diagnosis Survey, we checked whether the number of segments at the five selected measurement occasions (2003, 2005, 2007, 2009 and 2011) was constant, and the segments were of equal meaning. The results advocated for (1) segmentation with 10 distinct groups of households in each of the periods and (2) equal meaning of groups at all measurement occasions. Inclusion of households’ socio-economic characteristics improved the overall model fit and enabled decomposition of the total change in the pattern of debt possession between 2003 and 2011. The total effect was decomposed into effects associated with the transition of the Polish credit market and changes in the characteristics of households.

Suggested Citation

  • Piotr Białowolski, 2014. "Patterns of debt possession among households in Poland – a multi-group latent class approach," Bank i Kredyt, Narodowy Bank Polski, vol. 45(2), pages 79-104.
    • Handle: RePEc:nbp:nbpbik:v:45:y:2014:i:2:p:79-104
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    References listed on IDEAS

    as
    1. Paas, Leonard J. & Bijmolt, Tammo H.A. & Vermunt, Jeroen K., 2007. "Acquisition patterns of financial products: A longitudinal investigation," Journal of Economic Psychology, Elsevier, vol. 28(2), pages 229-241, April.
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    3. Bijmolt, T.H.A. & Paas, L.J. & Vermunt, J.K., 2004. "Country and consumer segmentation : Multi-level latent class analysis of financial product ownership," Other publications TiSEM fb506162-d125-4091-9083-9, Tilburg University, School of Economics and Management.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    households’ debt; multi-group latent class models;

    JEL classification:

    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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