Consumer Credit in Comparative Perspective

Abstract

We review the literature in sociology and related fields on the fast global growth of consumer credit and debt and the possible explanations for this expansion. We describe the ways people interact with the strongly segmented consumer credit system around the world—more specifically, the way they access credit and the way they are held accountable for their debt. We then report on research on two areas in which consumer credit is consequential: its effects on social relations and on physical and mental health. Throughout the article, we point out national variations and discuss explanations for these differences. We conclude with a brief discussion of the future tasks and challenges of comparative research on consumer credit.

Problem gambling and psychological distress: a cross-national perspective on the mediating effect of consumer debt and debt problems among emerging adults

“…Young people of today are taking debt at unprecedented levels [ 1 – 3 ]. General deregulation has made consumer lending attractive for various financial institutions throughout Western countries, including predatory and fringe banking agencies [ 4 , 5 ]. To this effect, the current young generation has been even labeled as a “generation indebted” in the USA [ 2 ].…”

“…There is significant variation between different countries in how insolvency is handled and regulated. Nordic countries, such as Finland or Sweden, take the pro-creditor stance [ 4 , 40 ]. In Finland, for instance, personal bankruptcy is not possible, and debt remains enforceable for 15 years in commercial cases and 20 years in criminal cases.…”

Society Against Markets. The Commodification of Money and the Repudiation of Debt

“…This process took shape roughly around the 1980s in the developed world, where financial markets reached a stage of impressive innovation, complexity and dynamism led by liberalization and deregulation. Nowadays, astonishing levels of credit, debts, stocks and insurances are traded on a real-time basis with the help of information technologies and risk-management techniques, becoming a global phenomenon (Rona-Tas & Guseva, 2018). This phenomenon was to a great extent driven by the fact that non-financial firms turn to finance as a source of profits.…”

A Sociological Review of China's Social Credit Systems and Guanxi Opportunities for Social Mobility

“…Increasingly, these consumer credit rating systems rely on algorithms and big data to generate scores of individuals (Marron, 2009;Rona-Tas & Guseva, 2018). Through the use of data, individuals become relegated to mere numbers (Rona-Tas & Guseva, 2018). In this way, banks are able to reduce uncertainty by associating individuals with ratings of risk factors, allowing them to decide credit limits more accurately (Guseva & Rona-Tas, 2001).…”

“…It has been suggested that individuals with bad credit and financial constraints are likely to experience limited career choices, which would lead to restrictions on social mobility (Shao, McKinney, & Shao, ). Increasingly, these consumer credit rating systems rely on algorithms and big data to generate scores of individuals (Marron, ; Rona‐Tas & Guseva, ). Through the use of data, individuals become relegated to mere numbers (Rona‐Tas & Guseva, ).…”