Financial decisions of households
Name
988751058-MIT.pdf
Description
Full printable version
Size
2.14 MB
Format
Adobe PDF
Checksum (MD5)
c6eca75046fc7c9932e976eefe690e9d
Author(s)
Jambulapati, Vikram
Advisor(s)
Antoinette Schoar.
Date Issued
2017
Publisher
Massachusetts Institute of Technology
Abstract
Left-digit bias refers to the tendency of individuals to focus attention on the leftmost digit of numerical information when making decisions. This paper tests for the existence of left-digit bias in the consumer credit card market. Using a regression-discontinuity design, I find sharp increases in credit card repayments around $1,000 monthly balance thresholds. The estimated effect, an approximately $20 increase in repayment, translates to about 4.35 percent of the average payment. However, I find smaller effects on future repayment behavior and the amount of future purchases. Finally, I find the effect to be stronger in higher self-reported income groups..
Description
Thesis: S.M. in Management Research, Massachusetts Institute of Technology, Sloan School of Management, 2017.
Cataloged from PDF version of thesis.
Includes bibliographical references (pages 22-23).
Subjects
Sloan School of Management.
MIT Department
Sloan School of Management
Terms of Use
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