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Intertemporal Consumption and Debt Aversion: A Replication and Extension

Author

Listed:
  • Ahrens, Steffen

    (FU Berlin)

  • Bosch-Rosa, Ciril

    (TU Berlin)

  • Meissner, Thomas

    (Maastricht University)

Abstract
We replicate Meissner (2016) where debt aversion was reported for the first time in an intertemporal consumption and saving problem. While Meissner (2016) uses a German sample, our subjects are US undergraduate students. All of the main findings from the original study replicate with similar effect sizes. Additionally, we extend the original analysis by correlating a new individual index of debt aversion on individual characteristics such as gender, cognitive ability, and risk aversion. The findings suggest that gender and risk aversion are not correlated with debt aversion. However, cognitive ability is positively correlated with debt aversion. Overall, this paper confirms the importance of debt aversion in intertemporal consumption problems and validates the approach of Meissner (2016).

Suggested Citation

  • Ahrens, Steffen & Bosch-Rosa, Ciril & Meissner, Thomas, 2022. "Intertemporal Consumption and Debt Aversion: A Replication and Extension," Rationality and Competition Discussion Paper Series 312, CRC TRR 190 Rationality and Competition.
    • Handle: RePEc:rco:dpaper:312
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    References listed on IDEAS

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    Cited by:

    1. Nobuyuki Hanaki & Yuta Shimodaira, 2024. "Wealth preferences and wealth inequality: Experimental evidence," ISER Discussion Paper 1260, Institute of Social and Economic Research, Osaka University.
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    3. Thomas Meissner & David Albrecht, 2022. "Debt Aversion: Theory and Measurement," Papers 2207.07538, arXiv.org, revised Jul 2022.

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    More about this item

    Keywords

    debt aversion; replication; experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

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