In 2005, reforms made formal personal bankruptcy much more costly. Shortly after, the US
began to experience its most severe recession in seventy years, and while personal …

Using US household‐level data and plausibly exogenous variation in the location‐timing of
home purchases with a single lender, I find that negative home equity causes a 2% to 6 …

For households with homes worth less than the mortgage I test the effect of “household debt
overhang” on their labor supply decisions. I utilize a new transaction-level dataset with …

This article studies the optimal determination of bankruptcy exemptions for risk averse
borrowers who use unsecured contracts but have the possibility of defaulting. In a large …

Following the historic decline in house prices during the recent financial crisis more than 15
million US mortgages, or approximately 1/3rd of mortgaged properties, had negative home …

The goal of this paper is to show that household-level financial distress (FD) varies greatly,
meaning there is unequal exposure to macroeconomic risk, and that FD can increase …

When a macroeconomic shock arrives, variation in household balance-sheet health
(captured by the presence of financial distress" FD"), leads to differential access to credit …

Abstract During the Great Recession, the collapse of consumption across the US varied
greatly but systematically with house-price declines. We find that financial distress among …

The goal of this paper is to show that household-level financial distress (FD) varies greatly,
meaning there is unequal exposure to macroeconomic risk, and that FD can increase …

This paper investigates how, and how much, household financial distress (FD), arising from
allowing debts to go unpaid, matters for the aggregate and cross-sectional consumption …