1 / 7

Implications of Household Debt in Croatia: A Comprehensive Analysis

This in-depth paper reviews the implications of household debt on financial stability in Croatia, examining various approaches, data sources, and econometric challenges. Explore the nuances of debt distribution and trends, with a focus on banks' exposure and debt growth decomposition. Gain insights into the evolving landscape of household debt and its effects on financial stability in Croatia.

kyoko
Download Presentation

Implications of Household Debt in Croatia: A Comprehensive Analysis

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Discussion on The Anatomy of Household Debt Build Up: What are the Implications for the Financial Stability in Croatia? BostjanJazbec IMF Senior Advisor to the Governor Central Bank of the Republic of Kosovo Dubrovnik, 25 June, 2010

  2. Quick Overview • Neatly defined goal of the paper: what are the implications for financial stability in Croatia? • Great literature review • Search for treshold of vulnerability • Three approaches: objective, subjective, and administrative • Aim: follow the changes in the distribution of household debt

  3. Problems with econometrics? • Mostly solved: • Non-random sample of indebted households • Macro vs. micro • Quantile regression with correction for sample selection bias + Machado and Mata decomposition method

  4. Data • Household Budget Survey (HSB) vs. macro data: discrepancy in debt exposure • How to account for that in your model? • Surprisingly mild rise of the proportion of indebted households from 2005 to 2008 • Focus on different categories of loan takers instead: isn’t that a little bit too detailed? (Table 2)

  5. Understanding the paper • Calculating the probabilities of having debt in 2008 prior of having debt in 2005 • What is interesting is the Machado-Mado decomposition of household debt growth! • Banks are relaxing standards • Building up the existing debt • What about new debt?

  6. How I would understand it better? • Data on banks’s exposure • Further elaboration on Table 2 • More on macro vs. micro evidence • 2009? • What is the implication for financial stability in Croatia?

More Related