Mortgage prepayment, race, and monetary policy

Gerardi, Kristopher; Willen, Paul S.; Zhang, David Hao

doi:10.1016/j.jfineco.2022.12.001

Cited by 22 publications

(3 citation statements)

References 59 publications

(51 reference statements)

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“…These issues have recently gained ground, both from an academic perspective and policy perspective (e.g. Bergman et al (2022), Bartscher et al (2021), Gerardi et al (2018). In this section we further assess how the effect of monetary policy on labor income differs depending on age and gender.…”

Section: Other Dimensions Of Heterogeneitymentioning

confidence: 99%

The Heterogeneous Effects of Monetary Policy on Labor Income: Disentangling the Extensive and Intensive Margins

Hubert,

Savignac

2024

Journal of Political Economy Macroeconomics

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Using French matched administrative-survey data, we quantify the distributional effects of monetary policy on labor income, decomposing the extensive and in-tensive margins of these effects. We provide evidence of heterogeneous exposure to unemployment and earnings risks. We find that the effects of ECB monetary policy shocks on labor income are driven by the extensive margin (transitions out of/to unemployment) at the bottom of the earnings distribution and by the intensive margin (changes in labor income for individuals continuously employed) at the top. Sectoral heterogeneity, particularly related to the labor force composition, plays an important role in explaining these heterogeneous effects.

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Section: Other Dimensions Of Heterogeneitymentioning

confidence: 99%

The Heterogeneous Effects of Monetary Policy on Labor Income: Disentangling the Extensive and Intensive Margins

Hubert,

Savignac

2024

Journal of Political Economy Macroeconomics

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“…Schwartz and Torous (1993), Keys et al (2016), Andersen et al (2020), Berger et al (2021)). Gerardi et al (2023) examine the factors and barriers to minority borrowers refinancing and mortgage prepayment. Zhang ( 2022) use a structural model to quantify the mortgage cross-subsidization upon heterogeneous borrower refinancing tendencies.…”

Section: Credit and Prepayment In Peer-to-peer Lendingmentioning

confidence: 99%

“…(2021)). Gerardi et al . (2023) examine the factors and barriers to minority borrowers refinancing and mortgage prepayment.…”

Section: Literature In Prepayment and Credit Utilizationmentioning

confidence: 99%

Prepayment and credit utilization in peer-to-peer lending

Yuan

Tao

2023

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PurposeThis research analyzes borrowers' credit utilization through prepayment behavior in peer-to-peer (P2P) lending. The authors investigate factors influencing the decision to prepay and assess the role of P2P lending as an alternative source of consumer credits.Design/methodology/approachThe authors use individual loan-level data from the LendingClub, one of the largest P2P platforms in the USA. The authors use a Logit model and a sample selection model estimated by the two-stage Heckman method. The empirical analysis considers borrower-specific and loan-specific characteristics as well as macroeconomic factors.FindingsThe authors present a number of significant findings that can enhance understanding consumers' financing decisions. The authors offer evidence that borrowers are able to take advantage of cheaper loans offered by P2P lending to better manage credit card balance and consolidate debt. The authors find that borrowers tend to prepay P2P loans quickly when the aggregate cost of borrowing is low, suggesting that P2P lending offers an efficient alternative to obtain credit. This is particularly true for creditworthy borrowers that are able to take advantage of competing sources of finance. The authors' results provide evidence that P2P lending can improve consumers' optimal credit utilization.Originality/valueP2P lending has grown exponentially and has become a significant credit supplier to consumers and small businesses. While the existing literature mostly focuses on default risks, prepayment has received much less attention. This research fills in the gap and investigates borrowers' prepayment behavior in P2P loans and the role of P2P lending as an alternative source of consumer credits.

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Mortgage Costs as a Share of Housing Costs—Placing the Cost of Credit in Broader Context

Begley¹,

Palim²

2023

Housing Policy Debate

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Mortgage prepayment, race, and monetary policy

Cited by 22 publications

References 59 publications

The Heterogeneous Effects of Monetary Policy on Labor Income: Disentangling the Extensive and Intensive Margins

The Heterogeneous Effects of Monetary Policy on Labor Income: Disentangling the Extensive and Intensive Margins

Prepayment and credit utilization in peer-to-peer lending

Mortgage Costs as a Share of Housing Costs—Placing the Cost of Credit in Broader Context

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