Dr. Meta Brown, Department of Economics
Rank at time of award: Assistant Professor
and
Dr. Rachel Dwyer, Department of Sociology
Rank at time of award: Associate Professor
and
Dr. Stephanie Moulton, John Glenn College of Public Affairs
Rank at time of award: Associate Professor
Summary/Abstract
We propose to develop a unique data infrastructure for studying household formation dynamics using credit report data. We will procure data from Experian, one of the three national credit bureaus, with data on the 90% of US households, supplemented with data on individuals with no credit file but who have used some alternative financial product such as a payday loan. These data provide highly valuable but rarely utilized insight into household formation dynamics because they involve very fine-grained observations of financial behavior in close to real-time increments. The frequent observations are particularly important for household dynamics in young adult and disadvantaged populations, which are more likely to experience significant flux in housing and household composition. Instead of waiting years for social surveys to produce what are often much cruder measures over time, we will observe processes as they unfold, including across the course of the COVID19 crisis.
Our overarching goal is to understand household formation as a coping strategy to manage financial stressors, a strategy that is deployed particularly by households without other recourse. How are households under financial strain weathering the COVID19 shock, and how does this exacerbate existing vulnerabilities and disparities? Though demographic research often considers how economic conditions and changes affect household composition and formation dynamics, most studies concentrate on income and employment dynamics exclusively. We contribute attention to the other side of the ledger in differential access to low-cost credit, which is shaped by macroeconomic conditions and micro-dynamics in household finances. We build our approach in three steps: (1) develop proof of concept operationalization of core constructs including household composition, household formation (and flux), and financial strain, and bring these together in tracking alternative financial coping strategies; (2) identify heterogeneity between households in exposure to financial strain, including understanding inequalities in vulnerability before the COVID19 crisis; and (3) estimate change in household formation with the onset and during the COVID19 crisis as a financial coping strategy especially for young adults.
Narrative
Our study of household coping strategies in a time of crisis will provide insight into core demographic processes in population distribution, household composition, and household change. These dynamics have significant implications for family demography, health across the life course, and migration processes. Household composition and flux are population dynamics that moreover significantly affect disparities in mental and physical well-being and the management of health crises (including COVID19) as well as differential morbidity and mortality.
Publications resulting from this seed grant
Editor-Reviewed Articles
Ricketts, Lowell, Meta Brown, J. Michael Collins, and Stephanie Moulton, “Older Americans Faced Early Pandemic Credit Constraints,” Federal Reserve Bank of St. Louis Economic Equity Insights, July 14, 2022.