This paper investigates the existence of liquidity constraints facing entrepreneurs in the United Kingdom. Using a household-level panel data set, entry to self-employment is shown to be a function of household net worth. We use inheritances and unanticipated movements in house prices as...

The 'financial accelerator' model when applied to households states that shocks to household balance sheets (primarily changes in house prices) amplify fluctuations in consumer spending by tightening or relaxing collateral constraints on borrowing. We construct an alternative model where...

The ‘financial accelerator’ model when applied to households states that shocks to household balance sheets (primarily changes in house prices) amplify fluctuations in consumer spending by tightening or relaxing collateral constraints on borrowing. We construct an alternative model where...

Recent household financial models predict that collateral-constrained households are more likely to increase debt-financed spending in response to rising house values. We augment this model to consider the use of unsecured debt such as credit cards. Using household panel data, we consider...

This paper investigates the existence of liquidity constraints facing entrepreneurs in the United Kingdom. Using a household-level panel data set, entry to selfemployment is shown to be a function of household net worth. We use inheritances and unanticipated movements in house prices as...

We examine the impact of unanticipated housing capital gains on consumption behavior using data from the British Household Panel Survey and county-level house price data. We condition the models on household financial expectations and on household real financial capital gains imputed from the...

We utilise questions concerning individual ‘debt literacy’ incorporated into market research data on households’ unsecured debt positions to examine the association between consumer credit and individual financial literacy. We examine the relationship between individual responses to debt...

We use household panel data to explore the link between changes in house prices and household indebtedness (both secured on housing assets and unsecured) in the United Kingdom. We show that households which are borrowing-constrained by a lack of housing equity as collateral make greater use of...

We survey a representative sample of UK consumers on their understanding of core ‘financial literacy’ concepts in consumer credit. We find levels of financial literacy are generally low in the population. We also find levels of financial literacy are on average actually lower among those who...

We use survey data from a sample of UK households to analyse the association between financial literacy and consumer credit portfolios. Among users of consumer credit there is much variation in levels of financial literacy. Borrowers with poor financial literacy hold higher shares of high cost...