Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/305690 
Year of Publication: 
2024
Series/Report no.: 
IZA Discussion Papers No. 17248
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
To protect financially distressed families during the COVID-19 pandemic, states implemented emergency measures such as moratoria on evictions and utility shutoffs. These policies prevented utility companies from disconnecting families' energy and water and landlords from obtaining court-ordered evictions for non-payment. Without these protections, consumers might have turned more often to high-cost alternative financial service (AFS) loans – such as payday loans - to pay their utility bills and rent. Using a random sample of 5 million consumers, we investigate whether moratoria on evictions and utility shutoffs impacted consumers' AFS use. Adults in states with an eviction or utility shutoff moratorium were less likely to borrow from high-cost non-banking institutions. Residents of high-poverty and Hispanic neighborhoods benefited the most from these protections. These results suggest that with such protections, families did not have to turn as often to high-cost loans to ensure access to housing and energy during financial distress.
Subjects: 
consumer protection policies
household finance
alternative financial services
JEL: 
D14
D18
G51
Document Type: 
Working Paper

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