content here is the anonymously transparent proxied version of ecb.europa.eu   X
European Central Bank - eurosystem
Suchoptionen
Startseite Medien Wissenswertes Forschung und Publikationen Statistiken Geldpolitik Der Euro Zahlungsverkehr und Märkte Karriere
Vorschläge
Sortieren nach
Nicht auf Deutsch verfügbar.

Győző Gyöngyösi

27 September 2022
WORKING PAPER SERIES - No. 2733
Details
Abstract
How do households adjust to a large debt shock? This paper studies household responses to a revaluation of foreign currency household debt during a large depreciation in Hungary. Relative to similar local currency debtors, foreign currency debtors reduce consumption expenditures approximately one-for-one with increased debt service, suggesting binding liquidity constraints. Foreign currency debtors reduce both the quantity and quality of expenditures, consistent with nonhomothetic preferences and a “flight from quality.” Debt revaluation has no effect on labor market status, hours, or earnings, but there is a small adjustment toward foreign income streams and a substantial increase in home production.
JEL Code
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
G51 : Financial Economics
J20 : Labor and Demographic Economics→Demand and Supply of Labor→General