WORKING PAPERS

WP66: Regulation of Subprime Mortgage Products: An Analysis of North Carolina’s Predatory Lending Law. by Gregory Elliehausen, Georgetown University and Michael Staten, Georgetown University, October 2002.

The purpose of this paper is to investigate the effects of the North Carolina law on the volume of subprime mortgage lending.  We apply multivariate statistical techniques that control for other factors that may have been influencing loan volumes.  The results indicate that after accounting for a variety of factors affecting supply or demand, creditors did indeed sharply restrict lending to higher risk customers—but not to customers in neighboring states or to lower risk customers in North Carolina—after passage of the law.  The findings support the hypothesis that creditors rationed the highest risk customers in response to the higher costs imposed by the North Carolina law.

WP65: College Student Credit Card Usage. by Michael E. Staten, Georgetown University and John M. Barron, Purdue University, June 2002.

This report provides benchmark measures of prominent attributes of college student credit card usage by utilizing a pooled sample of credit card accounts randomly selected from the portfolios of five of the top 15 general-purpose credit card issuers in the U.S. The analysis compares behavior across three types of accounts: those opened through college student card marketing programs, those opened by young adults aged 18-24 through normal marketing channels (i.e., not through dedicated student marketing programs), and those opened by older adults through normal marketing channels. All accounts analyzed in this study were opened during the period mid-1998 until early 2000 and observed over twelve-month periods during 2000-2001. This study is the first to utilize random samples of account-level data from a number of large credit card issuers to compare the activity and performance of student-marketed credit card accounts to other types of accounts.

WP64: An Empirical Evaluation of the Content and Cycle of Financial Reporting: The Case of Consumer Credit. by Thomas A. Durkin and Zachariah Jonasson Board of Governors of the Federal Reserve System

Hypotheses concerning patterns of journalistic reporting of consumer debt are tested by conducting a detailed content analysis of all relevant articles in the New York Times from 1950-95. Examination of this body of articles indicates that reporting is skewed toward the negative, it is cyclical in character, it follows the macroeconomic business cycle, and the pattern of reporting content is similar from one cycle to the next. In simple economic forecasting models, reporting of consumer credit is better explained statistically by economic variables other than credit growth rates themselves, most notably inflation rates. Although the methodology of the newspaper articles relies on presenting credit growth figures, timing and content of the articles are influenced by obtrusive economic events.

WP63: The Impact of Casino Gambling on Personal Bankruptcy Filing Rates. by John M. Barron Purdue University, Michael E. Staten Georgetown and Stephanie M. Wilshusen Georgetown University - March, 2002

Personal bankruptcies soared in the U.S. between 1994 and 1998. One activity that can precipitate personal financial crises and has also experienced growth as dramatic as personal bankruptcies over the past decade is the volume of casino gambling. This paper empirically determines whether casino gambling is associated with higher bankruptcy filing rates in and around counties where casinos have located. It concludes that the proximity of casino gambling appears to be associated with higher bankruptcy rates, but the local impact is far more pronounced than the influence of casino gambling on national filing rates. To quantify the magnitude of the impact, the analysis predicts a 5% decline in 1998 filing rates for counties surrounding a casino, and a 1% decline in filing rates nationwide, if one were to eliminate casino gambling. Consequently, although casino gambling exerts important local effects, nationwide the incidence and growth of casino gambling does not explain much of the rise in bankruptcies during the past decade.

WP62: The Impact Of Opt-In Privacy Rules On Retail Credit Markets: A Case Study Of MBNA. by Michael E. Staten, Georgetown University and Fred H. Cate, Indiana University School of Law - Bloomington

Advances in information technology have created a public-policy dilemma. Rapid access to personally identifiable information is becoming increasingly important to U.S. economic productivity, especially in the financial services industry. At the same time, consumers express a growing demand for "privacy," as that term refers to the ability to "control or conceal the use of information about oneself." Broad-based, "opt-in" laws have been proposed that would condition the collection, transfer or use of personal information on obtaining explicit consumer consent. This case study of a large U.S. financial services company shows how opt-in laws could threaten the viability of key services and products. MBNA Corporation has harnessed information technology as the engine for establishing and building customer relationships without every physically meeting its customers. We examine the implications of opt-in rules that would restrict the flow of personal information into the company from external sources, and within the company through artificial barriers to sharing across affiliates. We illustrate how opt-in laws neutralize some of the productivity gains generated by advances in information technology. Although the examples are cast specifically in terms of MBNA's products and services, most are also typical of the operations of the largest credit card issuers in the U.S. Consequently, the lessons can be generalized across the credit card and financial services industries as firms increasingly rely on personally identifiable information instead of physical contact (through brick-and mortar outlets) when developing a customer base. Revised: March 13, 2002.

WP61: The Impact of The Federal Reserve Board's Proposed Revisions to HOEPA on the Number and Characteristics of HOEPA Loans. by Michael E. Staten Georgetown University and Gregory Elliehausen Georgetown University, July, 2001

In December 2000, the Federal Reserve Board invited public comments on its proposed revisions to Regulation Z that would alter the criteria for a mortgage loan to be covered by the Home Ownership and Equity Protection Act (HOEPA). In various presentations since December, the Board has indicated that its proposal was intended to strike a balance between curbing a variety of abuses that have been termed "predatory lending" and impeding the general growth of the legitimate subprime mortgage market. However, the lack of comprehensive data about either the size of the subprime market or the characteristics of subprime loans has limited the Board's attempts at estimating the extent of current HOEPA coverage (as a proportion of all subprime mortgage loans) or quantifying the proposed expansion of coverage. This report utilizes information from a large population of mortgage loans originated or purchased by the subprime divisions of nine major national lenders to assess the impact of the Board's proposal on the number of loans covered by HOEPA. It also provides information on the types of loans and borrower characteristics that qualify as HOEPA loans under both the current and proposed rules.

WP60: Plastic Choices: Consumer Usage of Third Party vs. Proprietary Credit Cards in Retail Stores vs. Gasoline Outlets. Michael E. Staten and Ken Carow, 1995.

This paper presents evidence from two surveys on the reasons consumer choose to use a general purpose bank card vs. a proprietary credit card. One survey targeted holders of retail department and specialty store cards. The second survey targeted gasoline credit cardholders. Results yield insights about who would use a store card given the many general purpose card alternatives. The paper also discusses the prospects for co-branding by retailers, relative to gas card issuers.

WP59: The Cost Structure of the Consumer Finance Industry. Thomas A. Durkin and Gregory E. Elliehausen, 1994.

This paper estimates the cost function of the consumer finance company industry to explore the questions of existence of scale economics and elasticity of costs by loan size. Using more appropriate functional form and much newer data than in earlier studies, this study confirms their general conclusion that economics of scale in the industry are limited at the firm level but exist at the office level. Scale economics are found only at smaller offices, however, and they become exhausted as office size increases. Elasticity of operating costs with respect to loan size is shown to be well less than unity. (25 pp.)

WP58: The Impact of Post-Bankruptcy Credit on the Number of Personal Bankruptcies. Michael E. Staten, 1993.

This paper presents empirical evidence regarding forces that accelerated bankruptcies during the 1980s. Throughout the decade creditors accepted increasingly risky customers. Deregulation of interest rates and much improved risk management tools combined to generate aggressive competition for new accounts. Consequently, the greater supply of consumer credit increased the pool of potential bankrupts. However, credit grantors also extended credit to former bankrupts, gradually reducing borrowers' incentives to avoid bankruptcy. (41 pp.)

WP57: Discounts for Cash in Retail Gasoline Marketing. John M. Barron, Michael E. Staten, and John Umbeck, 1992.

This paper analyzes cash discounting in retail gasoline markets. This paper focuses on the peculiar period in the history of gasoline credit cards during which discounts for cash were introduced, became popular, and eventually faded. The more general question addressed is: What changed in the market to trigger the explicit pricing of credit service, and changed again by the end of the decade to discourage it?

WP56: Information Costs and the Organization of Credit Markets: A Theory of Indirect Lending. Michael E. Staten, John Umbeck and Otis Gilley, 1989.

This paper explains indirect lending as a strategy for reducing a bank's cost of screening borrowers. Commercial banks appear to "ration" credit by rejecting some direct loan applicants. However, they accept higher risk borrowers who apply for loans indirectly through retailers. The more thorough credit check on direct loans causes applicants to sort themselves according to risk. Indirect applications are cheaper to process because the applicants signal higher risk through their choice of financing. Implications are tested with data on 7000 automobile loans.

WP55: Economic Factors Associated With Delinquency Rates on Consumer Installment Debt. A. Charlene Sullivan, 1987.

Analysis of factors associated with variation in monthly delinquency rates for open and closed-end consumer loan portfolios held by commercial banks between 1975 and 1986. Includes estimates of effect of portfolio growth rates, business cycle, and market share on credit risk in the portfolio. (29 pp.).

WP54: Shopping for Consumer Credit: Implications for Market Efficiency. Debra Drecnik Worden and A. Charlene Sullivan, 1987.

The study uses data from the 1983 Survey of Consumer Finances to determine the extent to which consumers shop for credit. The characteristics of shoppers versus nonshoppers are compared, as well as the type of creditors serving them. (36 pp.).

WP53: Liquid Assets and Consumer Credit on the Household Balance Sheet. A. Charlene Sullivan, 1987.

The study uses data from the 1983 Survey of Consumer Finances to measure the liquid asset holdings of households using consumer credit. Most borrowers have liquid asset balances and about 40 percent of household using consumer credit have sufficient liquid assets to totally repay their consumer credit balances (32 pp.).

WP52: Economic and Demographic Factors Associated With Consumer Debt Use. A. Charlene Sullivan and Debra Drecnik Worden, 1986.

The study uses data from the 1983 Survey of Consumer Finances to evaluate the economic and demographic factors associated with 1) the probability that a household uses debt, and 2) the amount of debt relative to income used by households. (41 pp.)

WP51: Consumers' Choice of Consumer Loan Contract Terms. A. Charlene Sullivan, 1985.

Survey data collected from a sample of consumers who had recently obtained an auto loan from a bank were used to identify factors hat influenced consumers' choice between adjustable- and fixed-rate loans. The analysis provides evidence that consumers consider their expected economic condition when making their choice. Also, consumers with high credit risk chose contract terms that shielded them from "payment shock." (37 pp.)

WP50: The Behavior of Consumer Loan Rates Charged by Commercial Banks. A. Charlene Sullivan and James R. Fain, 1984.

Presents an econometric analysis of the behavior of rates (APR) charged for direct auto loans by commercial banks from 1972-1982. Provides evidence that consumer loan rates follow trends in market interest rates and lenders' opportunity cost of funds which is determined in a competitive securities market. (41 pp.)

WP49: Social Efficiency of the Bankruptcy Reform Act of 1978 with Regard to Personal Bankruptcy. A. Charlene Sullivan and Debra A. Drecnik, 1983.

Uses data from random samples of petitions for chapter 7 and chapter 13 to evaluate how frequently consumers' choice of avenue to debt relief provides creditors with the highest valued recovery (lowest social cost). (25 pp.)

WP48: Legal Aspects of Variable Rate Financing. Carl D. Lobell and Sheldon Feldman, 1983.

Provides a general overview of the regulatory efforts and problems associated with variable rate financing. Examines the complex decisions involved in a creditor's choice of index, spread, rate adjustment options, and negative amortization; the federal regulations in the home mortgage market; and regulations affecting variable rates for non-housing credit. (31 pp.)

WP47: Economic Factors Associated with Personal Bankruptcy. A. Charlene Sullivan, 1983.

Examines factors that explain trends in the rate of personal bankruptcy. Demonstrates the effects that the Bankruptcy Reform Act of 1978 had on the incidence of personal bankruptcy. (20 pp.)

WP46: Applications of Performance Scoring to Accounts Receivable Management in Consumer Credit. John Y. Coffman and Gary G. Chandler, 1983.

Performance scoring is based on data from creditors' accounts showing their customers' purchase and payment behavior. Coupled with information from credit reports, these data may be used to predict delinquency patterns for accounts in order to focus collection activity. Application of performance scoring illustrated using a bank credit card portfolio. (22 pp.)

WP45: The Role of Education Debt in Consumer's Total Debt Structure. Robert W. Johnson and A. Charlene Sullivan, 1983.

Examines the restrictions placed on the aggregate use of consumer and mortgage debt by lenders and by consumers themselves to determine whether cumulative student loan debt (GSL) may be high enough to cause some college graduates to be temporarily rationed from other credit markets. Increasing cost of education, coupled with potential lowering of aggregate credit limits, suggests some shouldering aside of other consumer debts, with education loans being preferred by consumers to loans to finance purchases of luxuries. (53 pp.)

WP44: Asset Exemptions and Propensity to File Personal Bankruptcy. A. Charlene Sullivan, 1982.

Uses data from the FSRP Bankruptcy Study to perform cross-state analysis of the relationship between the level of state asset exemptions and the wealth characteristics of petitioners for personal bankruptcy. (17 pp.)

WP43: Second Mortgage Survey 1981. Richard L. Peterson, Marc Van Doorne and Margaret Woo, 1982.

Reports findings from a survey of 88 members of the National Second Mortgage Association in 1981. It provides key summary statistics on second mortgage lending, activity loan terms, losses, and foreclosures. In addition, it analyzes the delinquency, operating cost, and profit experience of second mortgage lenders. Finally, it compares the experience and activities of different types of lenders in the second mortgage markets. (33 pp.)

WP42: Consumer Use of Mortgage Credit. Richard L. Peterson and A. Charlene Sullivan, 1981.

Analyzes factors influencing consumers' use of first mortgage credit to finance consumer durables purchased with the home. Tests whether low rate ceilings on consumer credit are associated with greater use of consumer credit relative to mortgage credit because they are rationed out of the consumer loan market. (26 pp.)

WP41: Costs and Benefits of Restrictions on Creditors' Remedies. Richard L. Peterson and Gregory A. Falls, 1981.

Compares creditors' use and valuation of collection remedies with consumers' valuation of and attitudes towards particular remedies. Consumers' attitudes are related to their past credit experience and anticipation of future payment difficulties. (61 pp.)

WP40: Impact of Ten Percent Usury Ceiling: Empirical Evidence. Richard L. Peterson and Gregory A. Falls, 1981.

Compares behavior of consumers and creditors in Arkansas with that of similar groups in states with higher rate ceilings. Compares amounts of cash and sales credit per capita, loan sizes and maturities, downpayment requirements, rejection rates, and market structure. (38 pp.)

WP39: Second Mortgage Survey, 1980. Richard L. Peterson, Dan A. Black, and Aaron L. Phillips, 1981.

Results of survey of second mortgage activities of members of National Second Mortgage Association, classified by major lender groups. A broad range of data is provided, including size and terms, growth in holdings, profitability of lending and delinquency, foreclosure, and loss experience of various lenders, as well as estimates of the speed with which second mortgage portfolios are liquidated. (35 pp.)

WP38: Effects of Consumer Loan Rate Ceilings on Competition Between Banks and Finance Companies. A. Charlene Sullivan, 1981.

Based on data collected in early 1979 in personal interviews of consumers and credit managers of banks and finance companies in similar, local markets in Illinois and Louisiana. Tests hypothesis that consumer loan markets are not segmented by risk when lenders operate under equal and nonrestrictive rate ceilings, but that markets are segmented in presence of different and restrictive rate ceilings. (27 pp.)

WP37: Household Financial Behavior: Implications for Consumer Spending. Charles A. Luckett, 1980.

Investigates, from evidence of aggregate economic data, the extent to which households may have become overextended between 1977 and 1979. Household survey data are used to examine borrowing behavior from a micro-economic perspective, especially to judge how the major expenditures of individual households are affected by large preexisting debt obligations. Provides a model for similar investigations of future expansions of consumer credit. (45 pp.)

WP36: Evidence of the Effect of Restrictive Loan Rate Ceilings on Prices of Consumer Financial Services. A. Charlene Sullivan, 1980.

Investigates the effect of restrictive consumer loan rate ceilings on the provision of and charges assessed by commercial banks for consumer savings and demand deposit services. Uses data collected from very inclusive survey of commercial banks serving four distinct local markets that differed sharply with regard to applicable rate ceilings. (29 pp.)

WP35: Restrictive Effects of Rate Ceilings on Consumer Choice: The Massachusetts Experience. Robert W. Johnson and A. Charlene Sullivan, 1980.

Using data from Massachusetts, traces the effects upon the availability of small loans and the viability of small finance companies of a reduction in rate ceilings implemented in January 1977. Survey data are used to estimate effects on high-risk consumers and to judge whether those denied credit by consumer finance companies could readily be accommodated by commercial banks or other lenders. (35 pp.)

WP34: Value Pricing of Bank Card Services. A. Charlene Sullivan and Robert W. Johnson, 1980.

Explores an alternative pricing structure that might be adopted for bank credit cards. Permitted charges suggested are (1) an annual percentage rate from date of purchase or posting to reflect cardholders' use of credit services; (2) a transaction fee for the value received by cardholders from having a convenient payment mechanism; and (3) an annual fee that would reflect the value of the option upon the line of credit provided cardholders. (34 pp)

WP33: Second Mortgage Survey, 1979. Richard L. Peterson and Debra A. Drecnik, 1980.

Results of survey of second mortgage activities of members of National Second Mortgage Association. A broad range of data by size of respondent is provided, including loan volume, outstandings, loan servicing, loans originated, loan purchases and sale, and key operating statistics. (45 pp.)

WP32: The Response of Commercial Banks to Rate Ceilings and Restrictions on Remedies on Consumer Credit Contracts. A. Charlene Sullivan, 1980.

Based on personal interviews of bank officers, analyzes responses of commercial banks to binding rate ceilings and restrictions on creditors' collection remedies. Responses tested are requirements of collateral, minimum size of unsecured loans, direct vs. indirect extensions of credit, rates charged, downpayment and cosigner requirements, and portion of banks portfolios committed to consumer credit (30 pp.)

WP31: Rates of Return on GNMA Securities: The Cost of Mortgage Funds. Kenneth B. Dunn and John J. McConnell, 1979.

Examines rates of return earned on GNMA mortgage-backed securities, 1971-1978. Clarifies aspects of computed "yields" on fixed income securities with emphasis on application to GNMA securities, and compares cost of obtaining funds by the U.S. government and by financially-strong corporations. (24 pp.)

WP30: Accelerating Inflation and the Distribution of Household Savings Incentives. Edward J. Kane, 1979.

Describes how accelerating inflation has led households in different economic and demographic classes to reallocate their "transactable" savings. Provides estimates of both the composition of accumulated household saving and prospective rates of return on this saving. Data underscore the unintended consequences of trying to reconcile deposit-rate ceilings with accelerating inflation. (53 pp.)

WP29: The Transfer Implications of Consumer Credit Regulation. William C. Dunkelberg, 1979.

Tests thesis that regulation of consumer credit results in the transfer of income and wealth among groups of consumers. Focuses on rate ceilings and restrictions on creditors' remedies and identifies and measures a series of related regulatory-induced income and wealth transfers. (47 pp.)

WP28: An Investigation of Sex Discrimination in Commercial Banks' Direct Consumer Lending. Richard L. Peterson, 1979.

A model of consumer credit market discrimination analogous to the best-known model of labor-market discrimination is developed and tested to see whether commercial banks behaved as profit-maximizers or discriminated against women before the Equal Credit Opportunity Act was passed. Tests on about 38,000 bank loans are based on male/female frequency of default and amounts of credit losses once in default. (28 pp.)

WP27: Mobile Home Demand and Sources of Financing. Charles A. Luckett, 1979.

Analyzes demographic characteristics of mobile homeowners, stock and annual purchases of mobile homes, and prospects for future growth of mobile homeownership and financing. (23 pp.)

WP26: Consumer Perceptions of Credit Bureaus. William C. Dunkelberg, Robert W. Johnson, and Robin DeMagistris, 1979.

Presents a sample of consumers' perceptions of credit bureaus and suggests how the revealed misperceptions could impact the regulation of credit. Also compares perceptions of regular and problem account holders. Based on a survey of California bank cardholders. (20 pp.)

WP25: Junior Mortgage Financing and Other Borrowing Against Inflated Housing Equity. David F. Seiders, 1978.

(37 pp.)

WP24: The Community Reinvestment Act of 1977: Its Legislative History and its Impact on Applications for Changes in Structure Made by Depository Institutions to the Four Federal Financial Supervisory Agencies. Warren L. Dennis, 1978.

Examines the Act, Congressional intent, general policy considerations in implementing the Act, and the context of the Act in the federal regulatory framework: presents a model for use by financial institutions to comply with the Act. (111 pp.)

WP22: An Economic Analysis of Electronic Funds Transfer System: The Theory of Credit Markets. John Umbeck and William C. Dunkelberg, 1978.

Uses tools of economics to help predict the impact of an electronic funds transfer system on supply and demand of credit and on intermediaries in the credit market. (25 pp.)

WP21: Bank and Retail Credit Card Yields Under Alternative Assessment Methods. E. Ray McAlister and Edward DeSpain, 1978.

Presents extensive empirical data to analyze the differences in yields resulting from various methods used by banks and retailers to assess finance charges on revolving credit. Analysis is based on actual account use patterns over an extended period of time. (4l pp.)

WP20: Banks Lending Response to Restricted Creditor Remedies. William C. Dunkelberg, 1978.

Based on results of a survey of banks in Wisconsin, study focuses on changes in lending policies of commercial banks, 1972-75, a period prior to and following the effective date of the Wisconsin Consumer Act. Reasons for change cited by respondents serve as a basis for inferences as to which consumers were affected by policy changes. (120 pp.)

WP19: Testing for Sex Discrimination in Commercial Bank Consumer Lending. Richard L. Peterson and Carol M. Peterson, 1978.

Examines whether commercial banks in fact systematically and prejudicially discriminated on the basis of sex in granting of consumer loans prior to enactment of the Equal Credit Opportunity Act. This hypothesis is tested against the alternative hypothesis that discrimination would have been unprofitable. Based on about 37,000 paid-off and charged-off consumer loans at commercial banks. (22 pp.)

WP18: Problems in Applying Discriminant Analysis In Credit Scoring Models. Robert W. Eisenbeis, 1978.

Reviews the types of credit scoring models that have been developed with particular emphasis on the methodological approaches that have been employed and the statistical problems associated with these models using discriminant analysis techniques. Emphasizes that profit maximization or cost minimization should be objective of a scoring model. (24 pp.)

WP17: Occupational Employment Variations in Commercial Bank Consumer Credit Risk. Richard L. Peterson, 1978.

Examines whether (I) credit applications' occupation and employment characteristics are significantly related to their likelihood of default on consumer loans, (II) relative credit-risk varies over the business cycle for members of different occupational risk and employment groups, and (III) occupational and employment credit risk are independent. Based on about 35,000 paid-off and charged-off commercial bank loans. (23 pp.)

WP15: The Impact of Creditors' Remedies on Consumer Loan Charges. Richard L. Peterson, 1977.

Uses data from Working Papers Nos. 6 and 10 to generate rough estimates of the annual costs (in the form of higher finance charges) of restrictions on creditors' remedies on new automobile loans, all automobile loans, and personal loans. (12 pp.)

WP14: Creditor Remedy Restrictions and Interstate Differences in Personal Loan Rates and Availability: A Supplementary Analysis. Richard L. Peterson and James R. Frew, 1977.

Extends an earlier study of the National Commission on Consumer Finance to determine the impact of restrictions on creditors' remedies on personal loan credit availability and personal loan finance rates. (18 pp.)

WP13: Changes in Finance Company Personal Loan Policies Following Enactment of the Wisconsin Consumer Act. Richard L. Peterson, 1977.

Documents changes in personal loan policies of consumer finance companies and delinquency and loss experience that might have resulted from restrictions on creditors' remedies embodied in the Wisconsin Consumer Act. Data from a survey of consumer finance companies are contrasted to data from a survey of national finance companies. (31 pp.)

WP12: The Impact of Restricted Creditors' Remedies on Automobile Finance Companies in Wisconsin. Richard L. Peterson, 1977.

Analyzes the impact of the Wisconsin Consumer Act (which has creditor remedy restrictions closely parallel to those proposed by the FTC) on automobile finance company operations in Wisconsin. Data were collected from major automobile finance companies operating in Wisconsin, with control data from Minnesota and the U.S. (39 pp.)

WP11: Commercial Bank Consumer Loan Refinancing. Richard L. Peterson, 1977.

Analyzes frequency with which consumer loans at commercial banks were paid off by refinancing and reasons for refinancing. Based on data on over 30,000 consumer loans. (14 pp.)

WP10: Regulatory Influence on Commercial Bank Personal Loan Rates. Richard L. Peterson and Michael D. Ginsberg, 1977.

Relates the most-common personal loan rate charged by a large, national sample of commercial banks to size of bank, rate ceilings, restrictions on creditors' remedies, branching privileges, urban or rural location, and geographical regions. (21 pp.).

WP9: Competition Between Banks and Finance Companies: A Cross Section Study of Personal Loan Debtors. Gregory E. Boczar, 1976.

Examines the question of whether competition between banks and finance companies for consumer credit customers is limited by market segmentation on the basis of customer risk. Contains important implications for evaluating the competitive effects of mergers between bank holding companies and finance companies and mergers among finance companies. (27 pp.)

WP8: Discrimination on the Basis of Sex Under the Equal Credit Opportunity Act. Gary G. Chandler and David C. Ewert, 1976.

Tests empirically the hypothesis that ignoring the sex of the applicant when granting credit will systematically diminish the opportunity for females to obtain credit. Analysis is applied to a large data base of applicants for bank credit cards (20 pp.)

WP7: Personal Loan Cash Flows at Finance Companies. Richard L. Peterson and Maura Eckert Benseler, 1976.

Shows how data on personal loan renewals can be used to estimate cash flows of personal loan extensions and renewals at consumer finance companies. Provides historical perspective by determining nature of seasonal and cyclical variations in cash flows of finance company personal loans over the period 1952-1975. (35 pp.)

WP6: Determinants of Commercial Bank Automobile Loan Rates. Richard L. Peterson and Michael D. Ginsberg, 1976.

Commercial bank auto loan rates are related to size of bank, rural v. urban locations, restrictive rate ceilings, restrictions on creditors' collection remedies, and limitations on branch banking. Empirical tests are based on data from the 315 large banks reporting auto loans to the Federal Reserve Board. (16 pp.)

WP5: Delinquency Rates on Consumer and Mortgage Debt: Their Determinants and Impact. Richard L. Peterson and Charles A. Luckett.

(57 pp.)

WP4: The Effect of Alternative Billing Methods upon Retail Revolving Credit Yields. E. Ray McAlister and Edward Despain.

(31 pp.)

WP3: Impact of General Credit Restraint on Consumer Installment Credit Flows. Richard L. Peterson, 1975.

(19 pp.)

WP2: EFTS and Consumer Credit (Revised). William C. Dunkelberg and Robert W. Johnson, 1975.

Trends in the market structure of suppliers of consumer credit and the motivation and demographic characteristics of credit users are examined in detail to predict how they will affect the development of electronic transfer systems. (79 pp.)

WP1: The Use of Department Store Revolving Credit: Account Use Patterns, Customer Profitability, the Value of Revolving Credit and the Probable Incidence of Credit Rationing. William C. Dunkelberg, Robert H. Smiley, and Robert P. Shay, 1975.

(55 pp.)

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