Socio-economic framework for the design of national household insolvency systems
Bibliographic Data
| ID | 4237247 |
|---|---|
| Authors | Xiaojing Wang (0000-0002-9319-3694, University of Ulster), Allen M Ward (0000-0002-6756-616X, University of Ulster, corresponding author) |
| Year | 2023 |
| Volume | 21 |
| Issue | 3 |
| Pages | 1473-1499 |
| Publication date | 2023-07-26 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Socio-Economic Review (JOURNAL) |
| Journal identifiers | ISSN: 1475-1461 • E-ISSN: 1475-147X |
| DOI | 10.1093/ser/mwad011 |
| OpenAlex | W4360608457 |
| Language | EN |
| References cited | 35 |
Lessons learned in the aftermath of the Financial Crisis of 2008 include that long, punitive household insolvency regimes have a negative societal impact, increase the potential for financial instability and hamper national economic recovery. We propose the Socio-Economic Framework for Household Insolvency System Design as a regulatory mechanism that aims to control national household debt and productivity levels. The system facilitates an informal resolution of the conflict between over-indebted households and their creditors. When this is not possible, the system grants immediate relief to no-income, no-assets and 'honest' households, that experienced over-indebtedness because of an external negative shock, such as a medical emergency. Finally, when the household does not qualify for immediate relief, the system allocates the costs of insolvency between the household and creditors, based on responsibility for the over-indebtedness. This reduces the moral hazard
Bankruptcy · Business · Creditor · Debt · Economic growth · Economics · Financial system · Household debt · Incentive · Insolvency · Market economy · Moral hazard · Political science · Productivity · Punitive damages · Shock (circulatory · Financial Literacy, Pension, Retirement Analysis · Housing Market and Economics · Housing, Finance, and Neoliberalism · Finance
Beyond GDP? Welfare across Countries and Time
Macrofinancial History and the New Business Cycle Facts
Bank-Based or Market-Based Financial Systems
Round the Houses
Welfare-state decommodification in 18 OECD countries
Borrowing for social security? Credit, asset-based welfare and the decline of the German savings regime
Over-indebtedness in Europe
The impact of debt and financial stress on health in Northern Irish households
Income inequality and household debt as a factor of financial fragility in the Spanish economy
What is patient capital and who supplies it
Credit policy and the 'debt shift' in advanced economies
The Political Economy of Ownership
Who's Borrowing? Credit Encouragement vs. Credit Mitigation in National Financial Systems
Credit Access and Social Welfare
In the Spotlight of Crisis
The impact of welfare on household debt
Payday lending in the UK
Household Debt in OECD Countries
| Citation velocity | historical |
|---|---|
| Highly cited | No |