Replication data for: Borrowing on the Wrong Credit Card? Evidence from Mexico
- Ponce, Alejandro
- Seira, Enrique
- Zamarripa, Guillermo
AbstractWe establish new facts about the way consumers allocate debt among their credit cards using data for a representative sample of cardholders in Mexico. We find that relative prices are weak predictors of the allocation of debt, purchases, and payments. Consumers allocate a large fraction of their debt to high-interest cards, incurring a cost of 31 percent above the minimum. Using an experiment, we find that consumers do not substitute in the price margin, although they respond to salient temporary low-interest offers. We conclude that limited attention and mental accounting best rationalize our results and discuss implications for the market.
Is supplement to
DOI: 10.1257/aer.20120273 (Text)
Ponce, Alejandro, Enrique Seira, and Guillermo Zamarripa. “Borrowing on the Wrong Credit Card? Evidence from Mexico.” American Economic Review 107, no. 4 (April 2017): 1335–61. https://doi.org/10.1257/aer.20120273.
- ID: 10.1257/aer.20120273 (DOI)
Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-12-06