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Credit purpose and the interest rate – Evidence from the European Household Finance and Consumption Survey

cris.lastimport.scopus2024-09-19T01:31:23Z
dc.abstract.enThe article presents empirical evidence for a significant role of stated creditpurpose for the level of interest rates paid by the end users of non-mortgagecredit (households). Data for the analysis was drawn from two waves of theHousehold Finance and Consumption Survey. The results of median regres-sion show that, with the exception of credit for consolidation of other debts,remaining credit purposes were associated with lower interest rates comparedto the interest rates of credit for car purchases. Especially low interest rateswere evidenced for educational debt. Quantile regression analysis has shownthat households which, given their socioeconomic background, experiencedthe highest interest rate costs, paid additional premiums if their debt wasrelated to consolidation of previous debts or consumption. In the case ofhouseholds paying relatively low premiums, consolidation of other debts andconsumption motives were associated with lower interest rates than loansdevoted to car purchase.
dc.affiliationAdministracji i Nauk Społecznych
dc.contributor.authorPiotr Bialowolski
dc.contributor.authorAndrzej Cwynar
dc.contributor.authorDorota Weziak‐Bialowolska
dc.date.accessioned2024-03-22T12:01:16Z
dc.date.available2024-03-22T12:01:16Z
dc.date.issued2022
dc.description.abstract<jats:title>Abstract</jats:title><jats:p>The article presents empirical evidence for a significant role of stated credit purpose for the level of interest rates paid by the end users of non‐mortgage credit (households). Data for the analysis was drawn from two waves of the Household Finance and Consumption Survey. The results of median regression show that, with the exception of credit for consolidation of other debts, remaining credit purposes were associated with lower interest rates compared to the interest rates of credit for car purchases. Especially low interest rates were evidenced for educational debt. Quantile regression analysis has shown that households which, given their socioeconomic background, experienced the highest interest rate costs, paid additional premiums if their debt was related to consolidation of previous debts or consumption. In the case of households paying relatively low premiums, consolidation of other debts and consumption motives were associated with lower interest rates than loans devoted to car purchase.</jats:p>
dc.identifier.doi10.1002/ijfe.2680
dc.identifier.issn1076-9307
dc.identifier.issn1099-1158
dc.identifier.urihttps://repo.akademiawsei.eu/handle/item/147
dc.languageen
dc.pbn.affiliationeconomics and finance
dc.relation.ispartofInternational Journal of Finance &amp; Economics
dc.rightsCC-BY
dc.subject.encredit purpose
dc.subject.enHousehold Finance and Consumption Survey
dc.subject.eninterest rates
dc.subject.ennon-mortgageloans
dc.titleCredit purpose and the interest rate – Evidence from the European Household Finance and Consumption Survey
dc.typeReviewArticle
dspace.entity.typePublication
oaire.citation.issue1
oaire.citation.volume29