A Generalized Framework for the Assessment of Household Financial Vulnerability

57 Pages Posted: 1 Dec 2017

See all articles by Mindaugas Leika

Mindaugas Leika

International Monetary Fund (IMF)

Daniela Marchettini

International Monetary Fund (IMF)

Date Written: November 2017

Abstract

Household financial fragility has received considerable attention following the globalfinancial crisis, but substantial gaps remain in the analytical underpinnings of householdfinancial vulnerability assessment, as well as in data availability. This paper aims atintegrating the contributions in the literature in a coherent fashion. The study proposes alsoanalytical and estimation extensions aimed at improving the quality of estimates andallowing the assessment of household financial vulnerability in presence of data limitations.The result of this effort is a comprehensive framework, that has wide applicability to bothadvanced and developing economies. For illustrative purposes the paper includes a detailedapplication to one developing country (Namibia).

Keywords: Credit risk, Sensitivity analysis, household, stress test, microdata, non–;parametric methods, non-parametric methods, Personal Income and Wealth Distribution

JEL Classification: C15, D31

Suggested Citation

Leika, Mindaugas and Marchettini, Daniela, A Generalized Framework for the Assessment of Household Financial Vulnerability (November 2017). Available at SSRN: https://ssrn.com/abstract=3079554 or http://dx.doi.org/10.2139/ssrn.3079554

Mindaugas Leika (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Daniela Marchettini

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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