Household debt, economic conditions, and income inequality: A state level analysis

Edmond Berisha, John Meszaros

Research output: Contribution to journalArticle

5 Scopus citations

Abstract

This paper uses OLS regressions to understand the relationship between household debt, income inequality, and economic growth in the United States. For robustness we use two different measures of income inequality. The results show that, for the period 2003–2012, there is statistical evidence that increases in household debt are associated with lower levels of economic growth and higher rates of unemployment. In addition, we uncover evidence that high growth rates in household debt are associated with negative growth in income inequality, likely because debt caused economic growth to slow, diminishing the returns of top earners.

Original languageEnglish
Pages (from-to)93-101
Number of pages9
JournalSocial Science Journal
Volume54
Issue number1
DOIs
StatePublished - 1 Mar 2017

Keywords

  • Economic growth
  • Household debt
  • Income inequality

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