• Media type: Report; E-Book
  • Title: Borrowing constraints and consumption behavior in Japan
  • Contributor: Wakabayashi, Midori [Author]; Horioka, Charles Yuji [Author]
  • Published: Osaka: Osaka University, Institute of Social and Economic Research (ISER), 2005
  • Language: English
  • Keywords: Einkommenshypothese ; Japan ; Kreditwürdigkeit ; Verbraucherkredit ; Theorie-Praxis-Verhältnis ; Lebenszyklus ; Konsumentenverhalten
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  • 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.
  • Access State: Open Access