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Psychology of Debt in Rural South India

Author

Listed:
  • Arnaud Natal

    (IFP - Institut Français de Pondichéry - MEAE - Ministère de l'Europe et des Affaires étrangères - CNRS - Centre National de la Recherche Scientifique, BSE - Bordeaux Sciences Economiques - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique, UB - Université de Bordeaux)

  • Christophe Jalil Nordman

    (IFP - Institut Français de Pondichéry - MEAE - Ministère de l'Europe et des Affaires étrangères - CNRS - Centre National de la Recherche Scientifique, LEDA-DIAL - Développement, Institutions et Mondialisation - LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique, IRD [Ile-de-France] - Institut de Recherche pour le Développement)

Abstract

This study is the first attempt to examine the extent to which the Big Five personality traits and cognitive skills (Raven scores, numeracy, and literacy scores) are correlated with debt negotiation and debt management in a Global South country; and how social identity – in particular caste and gender – channels the effect of cognition on debt outcomes. Using a panel dataset built from an original household survey (called NEEMSIS) conducted in 2016–2017 and 2020–2021 in rural Tamil Nadu, India, and employing multivariate correlation probit analysis with lagged variables, we find the following. Firstly, conscientiousness is an advantage in the negotiation and management of debt, particularly for non-Dalit women, suggesting that, in a rural patriarchal context, women leverage personality traits to overcome the constraints of social identity. Secondly, emotional stability is a disadvantage in both debt negotiation and management. Thirdly, the role of cognition and in particular the Raven score is ambiguous.

Suggested Citation

  • Arnaud Natal & Christophe Jalil Nordman, 2025. "Psychology of Debt in Rural South India," Post-Print hal-04962956, HAL.
    • Handle: RePEc:hal:journl:hal-04962956
    DOI: 10.1080/00220388.2025.2451871
    Note: View the original document on HAL open archive server: https://hal.science/hal-04962956v1
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