We investigate the relationship between household debt and income inequality in the USA, allowing for asymmetry, using data over the period 1913-2008. We find evidence of an asymmetric cointegration between household debt and inequality for different regimes. Our results indicate household debt only responds to positive changes in income inequality, while there is no evidence of falling inequality significantly affecting household debt. The presence of this asymmetry provides further empirical insights into the emerging literature on household debt and inequality.
History
Publication
Applied Economics Letters;24 (6), pp. 404-409
Publisher
Taylor and Francis
Note
peer-reviewed
The full text of this article will not be available on ULIR until the embargo expires on the 4/1/2018
Rights
This is an Author's Manuscript of an article whose final and definitive form, the Version of Record, has been published in Applied Economics Letters 2017 copyright Taylor & Francis, available online at: http://dx.doi.org/10.1080/13504851.2016.1197360