A Comparative Analysis Of Payday Loan Customers
Abstract"One of the most rapidly growing and controversial forms of consumer lending to recently emerge in the marketplace has been payday advances. This form of credit allows the borrower to obtain a small amount of cash for a short period of time. Claims of predatory lending often arise due to the high annual percentage rates that result from the fees for borrowing small amounts of money for 2 wk or less. By analyzing the data collected in a national survey of payday customers, this research allows policymakers to better understand what type of consumer borrows from payday lenders, for what purpose, and what the true benefits and costs are. The results confirm a strong demand for payday loans that satisfy a real financial need within a certain segment of the population. "("JEL "D12, D18, G20) Copyright (c) 2007 Western Economic Association International.
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Bibliographic InfoArticle provided by Western Economic Association International in its journal Contemporary Economic Policy.
Volume (Year): 26 (2008)
Issue (Month): 2 (04)
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Find related papers by JEL classification:
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D18 - Microeconomics - - Household Behavior - - - Consumer Protection
- G20 - Financial Economics - - Financial Institutions and Services - - - General
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- Wheatley, W. Parker, 2010. "Economic and Regional Determinants of the Location of Payday Lenders and Banking Institutions in Mississippi: Reconsidering the Role of Race and Other Factors in Firm Location," The Review of Regional Studies, Southern Regional Science Association, vol. 40(1), pages 53-69.
- Richard W. Evans, 2012. "Determinants of Short-term Consumer Lending Interest Rates," BYU Macroeconomics and Computational Laboratory Working Paper Series 2012-07, Brigham Young University, Department of Economics, BYU Macroeconomics and Computational Laboratory.
- Marianne Bertrand & Adair Morse, 2009.
"Information Disclosure, Cognitive Biases and Payday Borrowing,"
2009-007, Becker Friedman Institute for Research In Economics.
- Marianne Bertrand & Adair Morse, 2011. "Information Disclosure, Cognitive Biases, and Payday Borrowing," Journal of Finance, American Finance Association, vol. 66(6), pages 1865-1893, December.
- H. Damar, 2009. "Why Do Payday Lenders Enter Local Markets? Evidence from Oregon," Review of Industrial Organization, Springer, vol. 34(2), pages 173-191, March.
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