Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/297333 
Year of Publication: 
2024
Series/Report no.: 
ECB Working Paper No. 2893
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
Using microdata from a U.S. household survey, we document that immigrants who lived through a sovereign default episode are 7% less likely to hold debt relative to otherwise similar immigrants who reside in the same U.S. state and come from the same foreign country but who did not experience a default. Conditional on holding debt, consumers in the former group borrow less and service lower debt burdens. The negative effect on borrowing behavior of having experienced a sovereign default increases with family size and declines with education. These findings highlight the role of personal experience in shaping households' financial decisions.
Subjects: 
Sovereign default
household borrowing
experiences
immigrants
JEL: 
G11
G51
H63
D83
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-6373-2
Document Type: 
Working Paper

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