Borrowing constraints and consumption behavior in Japan
By: Midori Wakabayashi, Charles Yuji Horioka.
Contributors: Horioka, Charles.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11560; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11560.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Loans -- Japan.; Consumption (Economics) -- Japan.
Description: "In this paper, we use Japanese micro data to examine what characteristics borrowing-constrained households have and whether borrowing constraints have an important influence on household consumption behavior.  We identify borrowing-constrained households using three different indicators, some of which are unique to our data source, and find that the characteristics of households that are likely to be borrowing-constrained differ depending on which of the three indicators we use.  We also find that changes in current income have a positive and significant impact on changes in consumption in the case of households that are likely to be borrowing-constrained but not in the case of households that are unlikely to be borrowing-constrained.  This result suggests that borrowing constraints have an important influence on household consumption behavior and that the presence of borrowing constraints is one explanation for why the life cycle-permanent income hypothesis does not hold in the real world"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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