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Replication data for: A Simple Model of Subprime Borrowers and Credit Growth

Resource Type
  • Justiniano, Alejandro
  • Primiceri, Giorgio E.
  • Tambalotti, Andrea
Publication Date
  • Abstract

    The surge in credit and house prices that preceded the Great Recession was particularly pronounced in ZIP codes with a higher fraction of subprime borrowers (Mian and Sufi, 2009). We present a simple model with prime and subprime borrowers distributed across geographic locations, which can reproduce this stylized fact as a result of an expansion in the supply of credit. Due to their low income, subprime households are constrained in their ability to meet interest payments and hence sustain debt. As a result, when the supply of credit increases and interest rates fall, they take on disproportionately more debt than their prime counterparts, who are not subject to that constraint.
  • Is supplement to
    DOI: 10.1257/aer.p20161087 (Text)
  • Justiniano, Alejandro, Giorgio E. Primiceri, and Andrea Tambalotti. “A Simple Model of Subprime Borrowers and Credit Growth.” American Economic Review 106, no. 5 (May 2016): 543–47.
    • ID: 10.1257/aer.p20161087 (DOI)

Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-12-07

Justiniano, Alejandro; Primiceri, Giorgio E.; Tambalotti, Andrea (2016): Replication data for: A Simple Model of Subprime Borrowers and Credit Growth. Version: 1. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset.