Financial Trouble Across Generations: Evidence from the Universe of Personal Loans in Denmark
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Financial Trouble Across Generations : Evidence from the Universe of Personal Loans in Denmark. / Kreiner, Claus Thustrup; Leth-Petersen, Søren; Willerslev-Olsen, Louise Charlotte.
I: Economic Journal, Bind 130, Nr. 625, 01.01.2020, s. 233-262.Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
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TY - JOUR
T1 - Financial Trouble Across Generations
T2 - Evidence from the Universe of Personal Loans in Denmark
AU - Kreiner, Claus Thustrup
AU - Leth-Petersen, Søren
AU - Willerslev-Olsen, Louise Charlotte
PY - 2020/1/1
Y1 - 2020/1/1
N2 - This article uses administrative data with longitudinal information about defaults for the entire Danish population to analyse the driving forces behind financial problems. Non-parametric evidence shows that the default propensity is more than four times higher for individuals with parents in default compared with that for individuals with parents not in default. This intergenerational relationship is apparent soon after children move into adulthood and become legally able to borrow, and is remarkably stable across parental income levels, childhood school performances, levels of loan balances and time periods. The evidence indicates that inherited financial behaviour is important for explaining differences in financial trouble.
AB - This article uses administrative data with longitudinal information about defaults for the entire Danish population to analyse the driving forces behind financial problems. Non-parametric evidence shows that the default propensity is more than four times higher for individuals with parents in default compared with that for individuals with parents not in default. This intergenerational relationship is apparent soon after children move into adulthood and become legally able to borrow, and is remarkably stable across parental income levels, childhood school performances, levels of loan balances and time periods. The evidence indicates that inherited financial behaviour is important for explaining differences in financial trouble.
U2 - 10.1093/ej/uez046
DO - 10.1093/ej/uez046
M3 - Journal article
AN - SCOPUS:85081739803
VL - 130
SP - 233
EP - 262
JO - The Economic Journal
JF - The Economic Journal
SN - 0013-0133
IS - 625
ER -
ID: 248600576