ICAR Research Data Repository for Knowledge Management
Debt Traps? Market Vendors and Moneylender Debt in India and the Philippines
Harvard Dataverse (Africa Rice Center, Bioversity International, CCAFS, CIAT, IFPRI, IRRI and WorldFish)
View Archive Info| Field | Value | |
| Title |
Debt Traps? Market Vendors and Moneylender Debt in India and the Philippines
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| Identifier |
https://doi.org/10.7910/DVN/0KHZMI
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| Creator |
Karlan, Dean
Mullainathan, Sendhil Roth, Benjamin N. |
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| Publisher |
Harvard Dataverse
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| Description |
A debt trap occurs when someone takes on a high-interest rate loan and is barely able to pay back the interest, and thus perpetually finds themselves in debt (often by re-financing). Studying such practices is important for understanding financial decision-making of households in dire circumstances, and also for setting appropriate consumer protection policies. We conduct a simple experiment in three sites in which we paid off high-interest moneylender debt of individuals. Most borrowers returned to debt within six weeks. One to two years after intervention, treatment individuals were borrowing at the same rate as control households.
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| Subject |
Social Sciences
Household saving Personal finance Consumer protection Micro-based behavioral economics |
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| Contributor |
Research Transparency, Data Ethics, and Governance, Innovations for Poverty Action
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