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Households’ Borrowing Intentions During the COVID-19 Crisis: The Role of Financial Literacy

Author

Listed:
  • Lukasz Kurowski

    (Warsaw School of Economics)

  • Elzbieta Malinowska-Misiag

    (Warsaw School of Economics)

Abstract

This study aims to determine the role of financial literacy in households’ borrowing intentions during the coronavirus pandemic. Employing a survey of 1,300 Polish citizens conducted during the COVID-19 crisis and an instrumental variable analysis, we found that financial literacy significantly increases households’ borrowing intentions. This applies to financially sound consumers both in crisis and normal times. In terms of sociodemographic features, young adults and the less educated are less willing to borrow during the pandemic.

Suggested Citation

  • Lukasz Kurowski & Elzbieta Malinowska-Misiag, 2022. "Households’ Borrowing Intentions During the COVID-19 Crisis: The Role of Financial Literacy," Journal of Banking and Financial Economics, University of Warsaw, Faculty of Management, vol. 1(17), pages 798-113, September.
    • Handle: RePEc:sgm:jbfeuw:v:1:y:2022:i:17:p:98-113
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    File URL: https://jbfe.wz.uw.edu.pl/resources/html/article/details?id=231800
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    More about this item

    Keywords

    borrowing intentions; financial literacy; instrumental variables; quantile regression;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • G53 - Financial Economics - - Household Finance - - - Financial Literacy

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