We document the cyclical properties of unsecured consumer credit (procyclical and volatile) and of consumer bankruptcies (countercyclical and very volatile). Using a growth model with household heterogeneity in earnings and assets with access to unsecured credit (because of bankruptcy costs) and...

The goal of this paper is to show that household-level financial distress (FD) varies greatly, meaning there is unequal exposure to macroeconomic risk, and that FD can increase macroeconomic vulnerability. To do this, we first establish three facts: (i) regions in the U.S. vary significantly in...

This paper looks at arrears among US households between 1995 and 2013. It uses household data from the Survey of Consumer Finances (SCF) where arrears occur when a household reports it “sometimes got behind or missed a payment”. The key contribution is that it decomposes the change in...