Social Influence and the Consumer Bankruptcy Decision
January 2017
Working Paper Number:
CES-17-60
Abstract
I examine the influence of neighbors on the consumer bankruptcy decision using administrative bankruptcy records linked the 2000 Decennial Census. Two empirical strategies remove unobserved common factors that affect identification. The first strategy uses small geographical areas to isolate neighborhood effects, and the second strategy identifies the effect using past bankruptcy filers who moved states. The findings from
both strategies reinforce each other and confirm the role of social influence on the bankruptcy decision. Having a past bankruptcy filer move into the block from a different state increases the likelihood of filing by 10 percent.
Document Tags and Keywords
Keywords
Keywords are automatically generated using KeyBERT, a powerful and innovative
keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant
keywords.
By analyzing the content of working papers, KeyBERT identifies terms and phrases that capture the essence of the
text, highlighting the most significant topics and trends. This approach not only enhances searchability but
provides connections that go beyond potentially domain-specific author-defined keywords.
:
social,
financial,
state,
bankruptcy,
rural,
debt,
locality,
bankrupt,
district,
neighborhood,
credit,
resident,
filing,
neighbor,
creditor
Tags
Tags are automatically generated using a pretrained language model from spaCy, which excels at
several tasks, including entity tagging.
The model is able to label words and phrases by part-of-speech,
including "organizations." By filtering for frequent words and phrases labeled as "organizations", papers are
identified to contain references to specific institutions, datasets, and other organizations.
:
Ordinary Least Squares,
Decennial Census,
Protected Identification Key,
Federal Statistical Research Data Center
Similar Working Papers
Similarity between working papers are determined by an unsupervised neural
network model
know as Doc2Vec.
Doc2Vec is a model that represents entire documents as fixed-length vectors, allowing for the
capture of semantic meaning in a way that relates to the context of words within the document. The model learns to
associate a unique vector with each document while simultaneously learning word vectors, enabling tasks such as
document classification, clustering, and similarity detection by preserving the order and structure of words. The
document vectors are compared using cosine similarity/distance to determine the most similar working papers.
Papers identified with 🔥 are in the top 20% of similarity.
The 10 most similar working papers to the working paper 'Social Influence and the Consumer Bankruptcy Decision' are listed below in order of similarity.
-
Working PaperWho Files for Personal Bankruptcy in the United States?🔥
January 2017
Working Paper Number:
CES-17-54
Who files for bankruptcy in the United States is not well understood. Previous research relied on small samples from national surveys or a small number of states from administrative records. I use over 10 million administrative bankruptcy records linked to the 2000 Decennial Census and the 2001-2009 American Community Surveys to understand who files for personal bankruptcy. Bankruptcy filers are middle income, more likely to be divorced, more likely to be black, more likely to have terminal high school degree or some college, and more likely to be middle-aged. Bankruptcy filers are more likely to be employed than the U.S. as a whole, and they are more likely to be employed 50-52 weeks. The bankruptcy population is aging faster than the U.S. population as a whole. Lastly, using the pseudo-panels I study what happens in the years around bankruptcy. Individuals are likely to get divorced in the years before bankruptcy and then remarry. Income falls before bankruptcy and then rises after bankruptcy.View Full Paper PDF
-
Working PaperThe Two-Income Trap: Are Two-Earner Households More Financially Vulnerable?
June 2019
Working Paper Number:
CES-19-19
We test whether two-earner married couples are more likely to file for consumer bankruptcy in the future than similar married couples. Since two-earner households are unable to adjust their income on the extensive margin, they are more vulnerable to income shocks, and thus at risk of bankruptcy in the future. We find that two-earner married couples in 1999 are more likely to file for bankruptcy from 2002-2004 compared to other married couples. Additionally, we present supporting information that suggests that two-earner households have a higher average propensity to consume.View Full Paper PDF
-
Working PaperSpillovers From Costly Credit
March 2013
Working Paper Number:
CES-13-11
Recent research on the effects of credit access among low- and moderate-income households finds that high-cost payday loans exacerbate, rather than alleviate, financial distress for a subset of borrowers (Melzer 2011; Skiba and Tobacman 2011). In this study I find that others, outside the borrowing household, bear a portion of these costs too: households with payday loan access are 20% more likely to use food assistance benefits and 10% less likely to make child support payments required of non-resident parents. These findings suggest that as borrowers accommodate interest and principal payments on payday loan debt, they prioritize loan payments over other liabilities like child support payments and they turn to transfer programs like food stamps to supplement the household's resources. To establish this finding, the analysis uses a measure of payday loan access that is robust to the concern that lender location decisions and state policies governing payday lending are endogenous relative to household financial condition. The analysis also confirms that the effect is absent in the mid-1990s, prior to the spread of payday lending, and that the effect grows over time, in parallel with the growth of payday lending.View Full Paper PDF
-
Working PaperThe Effect of Housing Assistance Program on Labor Supply and Family Formation
August 2022
Working Paper Number:
CES-22-35
This paper studies the effect of U.S. Housing Choice Voucher Program Section 8 on low-income people' labor supply and family formation. I analyse this effect using data from the 2014 Panel and 2018 Panel of the restricted-use Survey of Income and Program Participation (SIPP). My economic approach is to explore the policy which assigns housing vouchers based on an income cutoff as an instrument to study the effect of housing vouchers on low-income people's employment and family formation. The assignment policy states that households with income lower than 50% of the median income for the MSA area are eligible for housing vouchers. With household eligibility status, I compare the households whose income is slightly below the income cutoff (eligible households) with the households whose income is slightly above the income cutoff (ineligible household) to identify the effect of housing vouchers on employment and family formation. I find that housing vouchers have a negative impact on individual labor supply through both extensive and intensive margins. In addition, housing vouchers also negatively impact family formation by decreasing marriage and increasing divorce rates. This project will contribute to understanding the effect of Section 8 Housing Vouchers on low-income households' labor supply and family formation.View Full Paper PDF
-
Working PaperWho Gentrifies Low Income Neighborhoods?
January 2008
Working Paper Number:
CES-08-02
This paper uses confidential Census data, specifically the 1990 and 2000 Census Long- Form data, to study the demographic processes underlying the gentrification of low income urban neighborhoods during the 1990's. In contrast to previous studies, the analysis is conducted at the more refined census-tract level with a narrower definition of gentrification and more narrowly defined comparison neighborhoods. The analysis is also richly disaggregated by demographic characteristic, uncovering differential patterns by race, education, age and family structure that would not have emerged in the more aggregate analysis in previous studies. The results provide little evidence of displacement of low-income non-white households in gentrifying neighborhoods. The bulk of the income gains in gentrifying neighborhoods are attributed to white college graduates and black high school graduates. It is the disproportionate in-migration of the former and the disproportionate retention and income gains of the latter that appear to be the main engines of gentrification.View Full Paper PDF
-
Working PaperThe Impact of Parental Resources on Human Capital Investment and Labor Market Outcomes: Evidence from the Great Recession
June 2024
Working Paper Number:
CES-24-34
I study the impact of parents' financial resources during adolescence on postsecondary human capital investment and labor market outcomes, using house value changes during the Great Recession of 2007-2009 as a natural experiment. I use several restricted-access datasets from the U.S. Census Bureau to create a novel dataset that includes intergenerational linkages between children and their parents. This data allows me to exploit house value variation within labor markets, addressing the identification concern that local house values are related to local economic conditions. I find that the average decrease to parents' home values lead to persistent decreases in bachelor's degree attainment of 1.26%, earnings of 1.96%, and full-time employment of 1.32%. Children of parents suffering larger house value shocks are more likely to substitute into two-year degree programs, drop out of college, or be enrolled in a college program in their late 20s.View Full Paper PDF
-
Working PaperNeighborhood Income and Material Hardship in the United States
January 2022
Working Paper Number:
CES-22-01
U.S. households face a number of economic challenges that affect their well-being. In this analysis we focus on the extent to which neighborhood economic conditions contribute to hardship. Specifically, using data from the 2008 and 2014 Survey of Income and Program Participation panel surveys and logistic regression, we analyze the extent to which neighborhoods income levels affect the likelihood of experiencing seven types of hardships, including trouble paying bills, medical need, food insecurity, housing hardship, ownership of basic consumer durables, neighborhood problems, and fear of crime. We find strong bivariate relationships between neighborhood income and all hardships, but for most hardships these are explained by other household characteristics, such as household income and education. However, neighborhood income retains a strong association with two hardships in particular even when controlling for a variety of other household characteristics: neighborhood conditions (such as the presence of trash and litter) and fear of crime. Our study highlights the importance of examining multiple measures when assessing well-being, and our findings are consistent with the notion that collective socialization and community-level structural features affect the likelihood that households experience deleterious neighborhood conditions and a fear of crime.View Full Paper PDF
-
Working PaperYou Can Take it With You: Proposition 13 Tax Benefits, Residential Mobility, and Willingness to Pay for Housing Amenities
June 2008
Working Paper Number:
CES-08-15
The endogeneity of prices has long been recognized as the main identification problem in the estimation of marginal willingness to pay (MWTP) for the characteristics of a given product. This issue is particularly important when estimating MWTP in the housing market, since a number of housing and neighborhood features are unobserved by the econometrician. This paper proposes the use of a well defined type of transaction costs ' moving costs generated by property tax laws - to deal with this type of omitted variable bias. California's Proposition 13 property tax law is the source of variation in transaction costs used in the empirical analysis. Beyond its fiscal consequences, Proposition 13 created a lock-in effect on housing choice because of the implicit tax break enjoyed by homeowners living in the same house for a long time. First, I provide estimates of this lock-in effect using a natural experiment created by two subsequent amendments to Proposition 13 - Propositions 60 and 90. These amendments allow households headed by an individual over the age of 55 to transfer the implicit tax benefit to a new home. I show that mobility rates of 55-year old homeowners are approximately 25% higher than those of 54 year olds. Second, all these features of the tax law are then incorporated into a household sorting model. The key insight of this model is that because of the property tax law, different potential buyers have different user costs for the same house. The exogenous property tax component of this user cost then works as an instrument for prices. I find that MWTP estimates for housing characteristics are approximately 100% upward biased when the model does not account for the price endogeneity.View Full Paper PDF
-
Working PaperBank Crises and Investor Confidence
January 2009
Working Paper Number:
CES-09-02
In addition to their direct effects, episodes of financial instability may decrease investor confidence. Measuring the impact of a crisis on investor confidence is complicated by the fact that it is difficult to disentangle the effect of investor confidence from coincident direct effects of the crisis. In order to isolate the effects of financial crises on investor confidence, we study the investment behavior of immigrants in the U.S. Our findings indicate that systemic banking crises have important effects on investor behavior. Immigrants who have experienced a banking crisis in their countries of origin are significantly less likely to have bank accounts in the U.S. This finding is robust to including important individual controls like wealth, education, income, and age. In addition, the effect of crises is robust to controlling for a variety of country of origin characteristics, including measures of financial and economic development and specifications with country of origin fixed effects.View Full Paper PDF
-
Working PaperChildhood Housing and Adult Earnings: A Between-Siblings Analysis of Housing Vouchers and Public Housing
January 2013
Working Paper Number:
CES-13-48RR
To date, research on the long-term effects of childhood participation in voucher-assisted and public housing has been limited by the lack of data and suitable identification strategies. We create a national level longitudinal data set that enables us to analyze how children's housing experiences affect adult earnings and incarceration rates. While naive estimates suggest there are substantial negative consequences to childhood participation in voucher assisted and public housing, this result appears to be driven largely by selection of households into housing assistance programs. To mitigate this source of bias, we employ household fixed-effects specifications that use only within-household (across-sibling) variation for identification. Compared to naive specifications, household fixed-effects estimates for earnings are universally more positive, and they suggest that there are positive and statistically significant benefits from childhood residence in assisted housing on young adult earnings for nearly all demographic groups. Childhood participation in assisted housing also reduces the likelihood of incarceration across all household race/ethnicity groups. Time spent in voucher-assisted or public housing is especially beneficial for females from non-Hispanic Black households, who experience substantial increases in expected earnings and lower incarceration rates.View Full Paper PDF
