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Forbearance vs. Interest Rates: Tests of Liquidity and Strategic Default Triggers in a Randomized Debt Relief Experiment

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  • Aydin, Deniz

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  • Aydin, Deniz, 2023. "Forbearance vs. Interest Rates: Tests of Liquidity and Strategic Default Triggers in a Randomized Debt Relief Experiment," EconStor Research Reports 268646, ZBW - Leibniz Information Centre for Economics.
    • Handle: RePEc:zbw:esrepo:268646
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    1. John Y. Campbell & João F. Cocco, 2003. "Household Risk Management and Optimal Mortgage Choice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(4), pages 1449-1494.
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    3. Deaton, Angus, 1991. "Saving and Liquidity Constraints," Econometrica, Econometric Society, vol. 59(5), pages 1221-1248, September.
    4. John Y. Campbell & João F. Cocco, 2015. "A Model of Mortgage Default," Journal of Finance, American Finance Association, vol. 70(4), pages 1495-1554, August.
    5. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-475, March.
    6. Barro, Robert J, 1989. "The Ricardian Approach to Budget Deficits," Journal of Economic Perspectives, American Economic Association, vol. 3(2), pages 37-54, Spring.
    7. Greg Kaplan & Giovanni L. Violante, 2014. "A Model of the Consumption Response to Fiscal Stimulus Payments," Econometrica, Econometric Society, vol. 82(4), pages 1199-1239, July.
    8. Will Dobbie & Jae Song, 2020. "Targeted Debt Relief and the Origins of Financial Distress: Experimental Evidence from Distressed Credit Card Borrowers," American Economic Review, American Economic Association, vol. 110(4), pages 984-1018, April.
    9. Adam M. Guren & Arvind Krishnamurthy & Timothy J. Mcquade, 2021. "Mortgage Design in an Equilibrium Model of the Housing Market," Journal of Finance, American Finance Association, vol. 76(1), pages 113-168, February.
    10. Emil Verner & Győző Gyöngyösi, 2020. "Household Debt Revaluation and the Real Economy: Evidence from a Foreign Currency Debt Crisis," American Economic Review, American Economic Association, vol. 110(9), pages 2667-2702, September.
    11. Dean Karlan & Jonathan Zinman, 2009. "Observing Unobservables: Identifying Information Asymmetries With a Consumer Credit Field Experiment," Econometrica, Econometric Society, vol. 77(6), pages 1993-2008, November.
    12. Glenn W. Harrison & Morten I. Lau & Melonie B. Williams, 2002. "Estimating Individual Discount Rates in Denmark: A Field Experiment," American Economic Review, American Economic Association, vol. 92(5), pages 1606-1617, December.
    13. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2013. "The Determinants of Attitudes toward Strategic Default on Mortgages," Journal of Finance, American Finance Association, vol. 68(4), pages 1473-1515, August.
    14. Therese C. Scharlemann & Stephen H. Shore, 2016. "The Effect of Negative Equity on Mortgage Default: Evidence From HAMP’s Principal Reduction Alternative," The Review of Financial Studies, Society for Financial Studies, vol. 29(10), pages 2850-2883.
    15. Marco Di Maggio & Amir Kermani & Benjamin J. Keys & Tomasz Piskorski & Rodney Ramcharan & Amit Seru & Vincent Yao, 2017. "Interest Rate Pass-Through: Mortgage Rates, Household Consumption, and Voluntary Deleveraging," American Economic Review, American Economic Association, vol. 107(11), pages 3550-3588, November.
    16. Meghan R. Busse & Christopher R. Knittel & Florian Zettelmeyer, 2013. "Are Consumers Myopic? Evidence from New and Used Car Purchases," American Economic Review, American Economic Association, vol. 103(1), pages 220-256, February.
    17. Satyajit Chatterjee & Dean Corbae & Makoto Nakajima & José-Víctor Ríos-Rull, 2007. "A Quantitative Theory of Unsecured Consumer Credit with Risk of Default," Econometrica, Econometric Society, vol. 75(6), pages 1525-1589, November.
    18. Deniz Aydin, 2022. "Consumption Response to Credit Expansions: Evidence from Experimental Assignment of 45,307 Credit Lines," American Economic Review, American Economic Association, vol. 112(1), pages 1-40, January.
    19. Janice Eberly & Arvind Krishnamurthy, 2014. "Efficient Credit Policies in a Housing Debt Crisis," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 49(2 (Fall)), pages 73-136.
    20. Peter Ganong & Pascal Noel, 2020. "Liquidity versus Wealth in Household Debt Obligations: Evidence from Housing Policy in the Great Recession," American Economic Review, American Economic Association, vol. 110(10), pages 3100-3138, October.
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    More about this item

    Keywords

    debt relief; forbearance; interest rates; liquidity; strategic; randomized field experiment;
    All these keywords.

    JEL classification:

    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy

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