Sustainable Household Debt : Towards an Operational View and Framework
Working paper
Permanent lenke
http://hdl.handle.net/11250/2507168Utgivelsesdato
2012Metadata
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- Staff Memo [282]
Sammendrag
From a broad financial stability perspective, sustainable household debt should be evaluated within a steady-state consumption-path approach. We calculate measures for households’ steady-state consumption based on average consumption to income ratios for a number of household groups and use a ‘counterfactual history approach’ to evaluate their debt sustainability. The results show that households within the first-home buyers and second steppers groups, which hold more than half of total household debt in Norway, are vulnerable to an increase in the loan rate.