www.philadelphiafed.org R eports in the popular press and policymakers’ concerns about student loans have greatly intensified in recent years because of rising student loan balances and defaults. Even greater cause for concern arose as student loans outstanding passed credit card debt to become the single largest nonmortgage household debt in 2012. Worries about the risk of massive default have...

Information asymmetries are important in theory but difficult to identify in practice. We estimate the presence and importance of hidden information and hidden action problems in a consumer credit market using a new field experiment methodology. We randomized 58,000 direct mail offers to former clients of a major South African lender along three dimensions: (i) an initial “offer interest rate” ...

Information asymmetries are important in theory but difficult to identify in practice. We estimate the presence and importance of hidden information and hidden action problems in a consumer credit market using a new field experiment methodology. We randomized 58,000 direct mail offers to former clients of a major South African lender along three dimensions: (i) an initial “offer interest rate” ...

In the context of Malaysian companies’ survival, potential role intended use proceeds as an influential factor remains unfamiliar. This study examines link between IPO and survival 423 listed companies over period 2000–2014. distinguishes into three segregations: growth opportunities, debt repayment, working capital. Employing Accelerated Failure Time (AFT) model, overall evidence shows a stati...

In China, termination of pilot employment has raised many arguments revolving around the training repayment. When pilots resign from their jobs or are fired, airlines generally claim compensation for cost. Questions arising in lawsuits can be divided into several categories: repayment window, amount, statutory exemptions, and unfair discharge. The incoherent interpretation Chinese Labour Contra...

We study, theoretically and empirically, the effort choices of microfinance borrowers under individual liability (IL) joint (JL) contracts when loan repayments are made either privately or publicly. Our theoretical model identifies guilt aversion in a JL contract shame public repayment loans as main psychological drivers choice. Evidence from our lab-in-the-field experiment Pakistan reveals lar...

The issue of bonus in life insurance is considered in a model framework where the traditional set-up is extended by letting the experience basis (mortality, interest, etc.) be stochastic. A novel definition of the technical surplus on an insurance contract is proposed, and basic principles for its repayment as bonus are discussed. Making the experience basis an endogenous part of the model open...