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Which Loans do We Take? A Micro-Level Analysis of Croatian Households’ Debt Participation

Author

Listed:
  • Mate Rosan

    (Croatian National Bank)

  • Krunoslav Zauder

    (Croatian National Bank)

Abstract

This paper uses a new data set in order to explore micro-level patterns of household borrowing in Croatia. By analyzing cross-section data from the Household Finance and Consumption Survey, conducted for the first time in Croatia in 2017, we present the structure of household debt holdings and identify several household characteristics associated with debt participation in three types of debt: secured debt, non-collateralized loans as well as overdrafts and/or credit card debt. Our results indicate that: a) households with middle aged heads tend to participate more and hold larger amounts of all three debt types, b) households with perceived credit constraints are more likely to take non-collateralized loans, and c) inability to finance consumption and willingness to take risks when making saving and investment decisions contribute to participation in overdrafts and/or credit card debt.

Suggested Citation

  • Mate Rosan & Krunoslav Zauder, 2020. "Which Loans do We Take? A Micro-Level Analysis of Croatian Households’ Debt Participation," Working Papers 61, The Croatian National Bank, Croatia.
    • Handle: RePEc:hnb:wpaper:61
    as

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    References listed on IDEAS

    as
    1. Aleksandra Riedl, 2019. "Household debt in CESEE economies: a joint look at macro- and micro-level data," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue Q1/19, pages 6-28.
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    6. Evan Kraft, 2007. "The Boom in Household Lending in Transition Countries: A Croatian Case Study and a Cross-Country Analysis of Determinants," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 49(3), pages 345-366, September.
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    Keywords

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    JEL classification:

    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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