Household Debt, Economic Conditions, and Income Inequality: A State Level Analysis

Authors

Edmond Berisha, Montclair State UniversityFollow
John Meszaros, United States Postal Service

Document Type

Article

Publication Date

3-1-2017

Journal / Book Title

The Social Science Journal

Abstract

This paper uses OLS regressions to understand the relationship between household debt, income inequality, and economic growth in the United States. For robustness we use two different measures of income inequality. The results show that, for the period 2003–2012, there is statistical evidence that increases in household debt are associated with lower levels of economic growth and higher rates of unemployment. In addition, we uncover evidence that high growth rates in household debt are associated with negative growth in income inequality, likely because debt caused economic growth to slow, diminishing the returns of top earners.

DOI

10.1016/j.soscij.2016.11.002

MSU Digital Commons Citation

Berisha, Edmond and Meszaros, John, "Household Debt, Economic Conditions, and Income Inequality: A State Level Analysis" (2017). Department of Economics Faculty Scholarship and Creative Works. 26.
https://digitalcommons.montclair.edu/economics-facpubs/26

Published Citation

Berisha, E., & Meszaros, J. (2017). Household debt, economic conditions, and income inequality: A state level analysis. Social Science Journal, 54(1), 93-101. https://doi.org/10.1016/j.soscij.2016.11.002