This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Journal: Macroeconomics: Vol. 2 No. 2 (April 2010)

Expand

Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter Subscription Information
(Institutional Administrator Access)

Explore:

AEJ: Macro - All Issues

AEJ: Macro Forthcoming Articles

Accounting for the Rise in Consumer Bankruptcies

Article Citation

Livshits, Igor, James MacGee, and Michèle Tertilt. 2010. "Accounting for the Rise in Consumer Bankruptcies." American Economic Journal: Macroeconomics, 2(2): 165-93.

DOI: 10.1257/mac.2.2.165

Abstract

Personal bankruptcies in the United States have increased dramatically, rising from 1.4 per thousand working age adults in 1970 to 8.5 in 2002. We use a heterogeneous agent life-cycle model with competitive lenders to evaluate several commonly offered explanations. We find that increased uncertainty (income shocks, expense uncertainty) cannot account quantitatively for the rise in bankruptcies. Instead, the rise in filings appears mainly to reflect changes in the credit market environment: a decrease in the transaction cost of lending and in the cost of bankruptcy. We also argue that the abolition of usury laws and other legal changes were unimportant. (JEL D14, E44, G21, G28)

Article Full-Text Access

Full-text Article

Additional Materials

Download Data Set (134.33 KB) | Appendix (196.76 KB)

Authors

Livshits, Igor (U Western Ontario and CIFAR)
MacGee, James (U Western Ontario and Federal Reserve Bank of Cleveland)
Tertilt, Michèle (Stanford U)

JEL Classifications

D14: Personal Finance
E44: Financial Markets and the Macroeconomy
G21: Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
G28: Financial Institutions and Services: Government Policy and Regulation

Comments

View Comments on This Article (0) | Login to post a comment


American Economic Journal: Macroeconomics


Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AEJ: Macro - All Issues

AEJ: Macro - Forthcoming Articles

Virtual Field Journals


AEA Member Login:


AEAweb | AEA Journals | Contact Us