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Obesity and Household Financial Distress

Author

Listed:
  • Guthrie, Katherine
  • Sokolowsky, Jan

Abstract

Obesity provides a potentially informative signal about individuals’ choices and preferences. Using National Longitudinal Survey of Youth (NLSY) data, we estimate that debt delinquency is 20 percent higher among the obese than the non-obese after controlling for an extensive set of financial and economic credit risk factors. The economic significance of obesity for delinquencies is comparable to that of job displacements. Obesity is particularly informative about delinquencies among those with low credit risk. In terms of channels, we find that the conditional obesity effect is partially mediated through health, but is not attributable to individuals’ attitudes, time and risk preferences, or cognitive skills.

Suggested Citation

  • Guthrie, Katherine & Sokolowsky, Jan, 2017. "Obesity and Household Financial Distress," Critical Finance Review, now publishers, vol. 7(1), pages 133-178, March.
    • Handle: RePEc:now:jnlcfr:104.00000034
    DOI: 10.1561/104.00000034
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    Citations

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    Cited by:

    1. Anup Agrawal & Yuree Lim, 2018. "Local Obesity Prevalence and Corporate Policies," Quarterly Journal of Finance (QJF), World Scientific Publishing Co. Pte. Ltd., vol. 8(02), pages 1-33, June.
    2. Jawad M. Addoum & George Korniotis & Alok Kumar, 2017. "Stature, Obesity, and Portfolio Choice," Management Science, INFORMS, vol. 63(10), pages 3393-3413, October.

    More about this item

    Keywords

    Consumer credit; Credit risk; Delinquency; Financial distress; Household finance; Obesity;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • 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
    • G00 - Financial Economics - - General - - - General
    • G19 - Financial Economics - - General Financial Markets - - - Other
    • I19 - Health, Education, and Welfare - - Health - - - Other

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