Ying Fan|Abdullah Yava?
How Does Mortgage Debt Affect Household Consumption? Micro Evidence from China
Tsinghua University|University of Wisconsin–Madison
abstract high growth rate mortgage debt various emerging developed economies captured headlines following financial crisis article investigate mortgage debt impacts household consumption behavior various components household consumption utilizing comprehensive household survey data china show households mortgage consume higher portion income households without mortgage line argument mortgage reduces uncertainty household faces regarding much save month order able house reduced uncertainty leads lower monthly savings purpose buying house also find among households mortgage spend larger share income mortgage payments spend less consumption reflecting crowding effect mortgage payments household consumption furthermore show government policy decreasing maximum loantovalue ratio significant impact households consumption article offers first evidence impact growing mortgage debt consumption behavior households implications government policies encourage mortgage borrowing