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The Impact of Economic Shocks on Financially Vulnerable Slovak Households: A Socio-Economic and Demographic Analysis

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  • Erik Gogola

    (University of Economics in Bratislava)

Abstract

This study identifies financially vulnerable indebted Slovak households most at risk of defaulting on loan payments due to socio-economic and demographic factors. The recent economic shifts, including a surge in Slovakia's inflation rate peaking at 15.4% in February 2023, have exacerbated financial strain. Analysis of HFCS microdata shows increased household indebtedness, particularly mortgage debt, from 2011 to 2021. Households with negative financial margins, limited liquid assets, younger (16-34) and older (65+) age groups, single-person households, and those in the lowest income and wealth quintiles are most vulnerable. Logistic regression reveals that gross income is the most significant determinant of default probability, with higher income households being less likely to default. The study highlights the need for targeted policy measures to support these vulnerable groups and mitigate default risks.

Suggested Citation

  • Erik Gogola, 0000. "The Impact of Economic Shocks on Financially Vulnerable Slovak Households: A Socio-Economic and Demographic Analysis," Proceedings of Economics and Finance Conferences 14316324, International Institute of Social and Economic Sciences.
    • Handle: RePEc:sek:iefpro:14316324
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    References listed on IDEAS

    as
    1. Valentina Michelangeli & Mario Pietrunti, 2014. "A Microsimulation Model to evaluate Italian Households Financial Vulnerability," International Journal of Microsimulation, International Microsimulation Association, vol. 7(3), pages 53-79.
    2. Kirsten Abela & Ilias Georgakopoulus, 2022. "A stress testing framework for the Maltese household sector," CBM Working Papers WP/04/2022, Central Bank of Malta.
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    More about this item

    Keywords

    Slovak household indebtedness; socio-economic and demographic factors HFCS; household vulnerability; logistic regression;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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