TY - JOUR
AU - Patrinos, Harry
AB - Debt aversion, an unwillingness to enter into a financial contract framed or labeled as debt, distorts household investment and financing decisions. We test through an experiment for the presence of debt aversion among a relevant population. The tests allow us to identify two sources of debt aversion: one due to framing (as debt or as an income-contingent contract) and another due to labeling (as a loan or as a human capital contract). Most of the debt aversion we identified was due to labeling. Labeling a contract as a loan decreased its probability of being chosen over a financially equivalent contract and increased its perceived cost.
TI - Measuring Aversion to Debt: An Experiment Among Student Loan Candidates
JF - Journal of Family and Economic Issues
DO - 10.1007/s10834-018-9601-8
DA - 2018-11-19
UR - https://www.deepdyve.com/lp/springer-journals/measuring-aversion-to-debt-an-experiment-among-student-loan-candidates-gAEF5af54O
SP - 117
EP - 131
VL - 40
IS - 1
DP - DeepDyve
ER -