Credit counseling: a substitute for consumer financial literacy?
Is financial literacy a substitute or complement for financial advice? We analyze the decision by consumers to seek financial advice in the form of credit counseling. Credit counseling is an important component of the consumer credit sector for consumers facing debt problems. Our analysis accounts f...
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| Format: | Article |
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Cambridge University Press
2015
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| Online Access: | https://eprints.nottingham.ac.uk/31375/ |
| _version_ | 1848794187064934400 |
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| author | Disney, Richard Gathergood, John Weber, Jörg |
| author_facet | Disney, Richard Gathergood, John Weber, Jörg |
| author_sort | Disney, Richard |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | Is financial literacy a substitute or complement for financial advice? We analyze the decision by consumers to seek financial advice in the form of credit counseling. Credit counseling is an important component of the consumer credit sector for consumers facing debt problems. Our analysis accounts for the endogeneity of an individual's financial situation to financial literacy, and the endogeneity of financial literacy to exposure to credit counseling. Results show counseling substitutes for financial literacy. Individuals with better literacy are 60% less likely to use credit counseling. These results suggest that credit counseling provides a safety net for poor financial literacy. |
| first_indexed | 2025-11-14T19:12:12Z |
| format | Article |
| id | nottingham-31375 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| last_indexed | 2025-11-14T19:12:12Z |
| publishDate | 2015 |
| publisher | Cambridge University Press |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-313752020-05-04T17:15:52Z https://eprints.nottingham.ac.uk/31375/ Credit counseling: a substitute for consumer financial literacy? Disney, Richard Gathergood, John Weber, Jörg Is financial literacy a substitute or complement for financial advice? We analyze the decision by consumers to seek financial advice in the form of credit counseling. Credit counseling is an important component of the consumer credit sector for consumers facing debt problems. Our analysis accounts for the endogeneity of an individual's financial situation to financial literacy, and the endogeneity of financial literacy to exposure to credit counseling. Results show counseling substitutes for financial literacy. Individuals with better literacy are 60% less likely to use credit counseling. These results suggest that credit counseling provides a safety net for poor financial literacy. Cambridge University Press 2015-10-01 Article PeerReviewed Disney, Richard, Gathergood, John and Weber, Jörg (2015) Credit counseling: a substitute for consumer financial literacy? Journal of Pension Economics and Finance, 14 (04). pp. 466-491. ISSN 1475-3022 Credit counseling; financial advice; financial literacy; household finance http://journals.cambridge.org/abstract_S1474747215000219 doi:10.1017/S1474747215000219 doi:10.1017/S1474747215000219 |
| spellingShingle | Credit counseling; financial advice; financial literacy; household finance Disney, Richard Gathergood, John Weber, Jörg Credit counseling: a substitute for consumer financial literacy? |
| title | Credit counseling: a substitute for consumer financial literacy? |
| title_full | Credit counseling: a substitute for consumer financial literacy? |
| title_fullStr | Credit counseling: a substitute for consumer financial literacy? |
| title_full_unstemmed | Credit counseling: a substitute for consumer financial literacy? |
| title_short | Credit counseling: a substitute for consumer financial literacy? |
| title_sort | credit counseling: a substitute for consumer financial literacy? |
| topic | Credit counseling; financial advice; financial literacy; household finance |
| url | https://eprints.nottingham.ac.uk/31375/ https://eprints.nottingham.ac.uk/31375/ https://eprints.nottingham.ac.uk/31375/ |