Attitudes, Personality Factors and Household Debt Decisions: A Study of Consumer Credit

30 Pages Posted: 3 Oct 2010

See all articles by Stefano Cosma

Stefano Cosma

Università degli studi di Modena e Reggio Emilia

Francesco Pattarin

CEFIN Centro Studi di Banca e Finanza - Università di Modena e Reggio Emilia

Date Written: June 20, 2010

Abstract

A fairly extensive literature from the field of empirical psychology has provided evidence that personality factors and attitudes toward credit may influence individuals' debt financing decisions. This paper investigates the importance of these factors by analysing the results of an original survey about the recourse to consumer credit, conducted on a wide sample of Italian households. Three main research questions are addressed. Is there any relationship between personality, attitude and recourse to consumer credit? Are there any differences in psychological profiles of credit users and non-users that can be associated with the motivations for using consumer credit? Does the psychological profile affect the preferred way of financing consumption? According to our analyses, the influence of psychological factors on consumer credit decisions cannot be rejected. Attitudes toward debt appear to play an important role and are significantly related to motivations for using credit and to the preferred form of financing. Personality factors do not emerge as having a clearcut effect on the decision to taking on debt. While this is in line with some previous research findings, when personality's features make a difference this is in the opposite direction of what is commonly found, as more fatalistic individuals are less likely to use consumer credit.

Keywords: consumer credit, attitudes, personality factors

JEL Classification: D12

Suggested Citation

Cosma, Stefano and Pattarin, Francesco, Attitudes, Personality Factors and Household Debt Decisions: A Study of Consumer Credit (June 20, 2010). Available at SSRN: https://ssrn.com/abstract=1685765 or http://dx.doi.org/10.2139/ssrn.1685765

Stefano Cosma

Università degli studi di Modena e Reggio Emilia ( email )

Viale A. Allegri 9
41100 Modena, Modena 42121
Italy

Francesco Pattarin (Contact Author)

CEFIN Centro Studi di Banca e Finanza - Università di Modena e Reggio Emilia ( email )

viale Berengario 51
Modena, 41100
Italy
+39 059 2056816 (Phone)

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