Consumer financial literacy and the efficiency of mortgage-related decisions: New evidence from the Panel Study of Income dynamics

被引:24
作者
Bialowolski, Piotr [1 ,2 ]
Cwynar, Andrzej [3 ]
Xiao, Jing Jian [4 ]
Weziak-Bialowolska, Dorota [1 ]
机构
[1] Harvard TH Chan Sch Publ Hlth, Dept Environm Hlth, Sustainabil & Hlth Initiat SHINE, Boston, MA 02115 USA
[2] WSB Univ, Dept Management, Dabrowa Gornicza, Poland
[3] Univ Econ & Innovat, Fac Adm & Social Sci, Lublin, Poland
[4] Univ Rhode Isl, Transit Ctr, Human Dev & Family Studies, Kingston, RI 02881 USA
关键词
financial literacy; interest rate; mortgage debt; Panel Study of Income Dynamics; refinancing decisions; HOUSEHOLD FINANCES; LIFE-CYCLE; CREDIT USE; CONSUMPTION; EDUCATION; INVESTMENT;
D O I
10.1111/ijcs.12646
中图分类号
F [经济];
学科分类号
02 ;
摘要
This study evaluated the link between financial literacy and household mortgage decisions. To this end, the longitudinal data set for the U.S. population from the Panel Study of Income Dynamics (PSID) was used. Evidence for links between financial literacy levels and (1) mortgage uptake, (2) mortgage interest rates and (3) mortgage refinancing decisions were examined using the two waves (2015 and 2017) of PSID data, combined with the 2016 PSID supplementary questionnaire examining the measured financial literacy of household members. Our results revealed a positive link between financial literacy and mortgage possession and, additionally, between financial literacy and the subsequent decision to take out a mortgage. Moreover, higher financial literacy scores were associated with lower mortgage interests and a greater likelihood of mortgage refinancing. On average, a household that refinanced its mortgage was able to reduce its interest rate by almost 0.7 percentage points, providing evidence of the positive role of financial literacy in securing better mortgage terms.
引用
收藏
页码:88 / 101
页数:14
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