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Does Financial Assistance Really Assist? The Impact of Debt on Wellbeing, Health Behavior and Self-Concept in Taiwan

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  • Ming-Chang Tsai
  • Rachel Dwyer
  • Ruey-Ming Tsay

Abstract

In the current global environment of unpredictable economic adversity, financial help appears to be all the more important in order for people to make it through hard times. Social support theory expects that debt’s adverse impact on subjective well-being can be moderated by access to financial help within one’s social network. This study tests this hypothesis by extending research attention into social contacts and self-concept as well. Using a national probability sample of Taiwan, we conduct regression-estimation-with-measurement modeling to assess the impact of debt and unrealized loss (UL) in housing price on life situation. Our finding shows that both debt and UL produce direct negative impact on happiness and health behaviors, while they has scant influence on social contacts and self-esteem. Financial assistance from kin somewhat moderates the adverse influences of indebtedness, while financial assistance from friends and banks mostly represents a debt trap that leads to lower levels of life satisfaction and self-concept. We conclude that seeking financial help, in general, is a response to rather than a solution for indebtedness. Copyright Springer Science+Business Media Dordrecht 2016

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  • Ming-Chang Tsai & Rachel Dwyer & Ruey-Ming Tsay, 2016. "Does Financial Assistance Really Assist? The Impact of Debt on Wellbeing, Health Behavior and Self-Concept in Taiwan," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(1), pages 127-147, January.
    • Handle: RePEc:spr:soinre:v:125:y:2016:i:1:p:127-147
    DOI: 10.1007/s11205-014-0835-z
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    2. Kamer Karakurum-Ozdemir & Melike Kokkizil & Gokce Uysal, 2019. "Financial Literacy in Developing Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 143(1), pages 325-353, May.
    3. Thanh-Tung Nguyen & Trung Thanh Nguyen & Ulrike Grote, 2020. "Credit and Ethnic Consumption Inequality in the Central Highlands of Vietnam," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 148(1), pages 143-172, February.
    4. Wang, Chao & Feng, Chen & Bai, Caiquan, 2023. "Industrial policy and resident health: Historical evidence from China’s Third Front construction," Journal of Asian Economics, Elsevier, vol. 89(C).
    5. Begoña Gutiérrez-Nieto & Carlos Serrano-Cinca & Beatriz Cuéllar-Fernández & Yolanda Fuertes-Callén, 2017. "The Poverty Penalty and Microcredit," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(2), pages 455-475, September.
    6. Soomin Ryu & Lu Fan, 2023. "The Relationship Between Financial Worries and Psychological Distress Among U.S. Adults," Journal of Family and Economic Issues, Springer, vol. 44(1), pages 16-33, March.
    7. Umer Mushtaq Lone & Suhail Ahmad Bhat, 2024. "Impact of financial literacy on financial well-being: a mediational role of financial self-efficacy," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 29(1), pages 122-137, March.

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