Household Debt and Recession in Brazil

Produced by: 
National Bureau of Economic Research
Available from: 
October 2018
Paper author(s): 
Gabriel Garber
Atif Mian
Jacopo Ponticelli
Amir Sufi
Topic: 
Financial Economics
Year: 
2018

Brazil experienced one of the most severe recessions in its history from 2014 to 2016. Following a pattern shown for previous economic downturns in other countries, the Brazilian recession was preceded by a substantial increase in household debt from 2003 to 2014. This study utilizes a novel individual level data set on household borrowing in order to provide details of the household debt boom. The data set allows for a decomposition of the rise in household debt by the type of debt and by the source of debt, and it allows for an analysis of the income of individuals taking on more debt during the boom. We conclude with an exploration of potential causes of the rise in household debt.

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