The dynamics of work and debt
By: Jeffrey R. Campbell, Zvi Hercowitz.
Contributors: Hercowitz, Zvi.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 10201; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 10201.
Publisher: National Bureau of Economic Research
Published: 2004
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Labor supply -- Econometric models.; Debt -- Econometric models.; Households -- Economic aspects -- Econometric models.
Description: "This paper characterizes the labor supply and borrowing of a household facing collateral requirements that limit its debt and compel it to accumulate equity in its durable goods stock.  The household's discount rate exceeds the market rate of interest, so it would otherwise finance increased current consumption by borrowing against future wages.  Collateral constraints generate a positive comovement between the household's debt, the stock of durable goods and labor supply following wage or interest rate shocks---as the household's labor supply adjusts to finance downpayments on new durable good purchases and the subsequent debt repayment.  Increasing the speed of debt repayment amplifies these movements"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
Title from PDF file as viewed on 1/26/2005.
Also available in print.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.