Households Indebtedness and Financial Stability: Empirical Analysis from the Czech Republic
| Název práce v češtině: | Zadlužení domácností a finanční stabilita: empirická analýza pro ČR |
|---|---|
| Název v anglickém jazyce: | Households Indebtedness and Financial Stability: Empirical Analysis from the Czech Republic |
| Klíčová slova: | domácnosti, zadlužení, finanční stabilita, Česká republika |
| Klíčová slova anglicky: | households, indebtedness, financial stability, non-performing loans, Czech Republic, VAR, VECM |
| Akademický rok vypsání: | 2012/2013 |
| Typ práce: | diplomová práce |
| Jazyk práce: | angličtina |
| Ústav: | Institut ekonomických studií (23-IES) |
| Vedoucí / školitel: | PhDr. Jakub Seidler, Ph.D. |
| Řešitel: | skrytý - zadáno vedoucím/školitelem |
| Datum přihlášení: | 05.06.2013 |
| Datum zadání: | 05.06.2013 |
| Datum a čas obhajoby: | 23.09.2014 09:30 |
| Místo konání obhajoby: | IES |
| Datum odevzdání elektronické podoby: | 28.07.2014 |
| Datum proběhlé obhajoby: | 23.09.2014 |
| Oponenti: | Mgr. Hana Džmuráňová, Ph.D. |
| Kontrola URKUND: | |
| Předběžná náplň práce v anglickém jazyce |
| The level of households’ indebtedness has risen substantially in absolute terms as well as relative to household income over past two decades practically in whole Europe. This trend raised concerns about the sustainability of household debt and the consequences for the financial stability. Two main factors behind this increase are financial deregulation, which decreased the level of credit rationing, and lower nominal as well as real interest rates. Situation in the Czech Republic during 90s was unique. There was no substantial raise in the level of indebtedness. It could be attributed to huge economic and social changes, unsure future and unwillingness of banks to provide loans for small clients. Volume of loans started to rise substantially around the year 2000. The environment with stable and low interest rates, GDP growth or investments in the economy was behind this increase. Increasing level of households’ indebtedness could be dangerous mainly because of two reasons – households will be more sensitive to the, especially unexpected, changes in interest rates and to changes in income resulting from unemployment.
The aim of this thesis is to evaluate main factors affecting the level of households’ indebtedness and their influence on the amount of non-performing loans. The connection between financial stability indicators such as GDP growth, inflation, unemployment rate, household consumption, interest rates or house prices and the households’ debt will be also examined. Using macroeconomic data thesis will also provide comparison of the structure of households’ debts between Czech Republic and other similar countries such as Slovakia, Poland etc. The first hypothesis is that lending rate and households’ consumption have significant effect on the level of households’ indebtedness. The reason behind this assumption is following: increase in lending rate will increase the cost of borrowing from bank and therefore reduce the amount of funds to be borrowed. On the other hand to finance higher level of consumption households need to have more funds and therefore borrow more. The second hypothesis states that the amount of non-performing loans is increasing with raise in the level of households’ indebtedness and with rising interest rates and is decreasing with positive GDP growth and inflation. In this thesis I am going to use macroeconomic data provided by Czech Statistical Office and Czech National Bank. If micro-data will be also available they could be used for the deeper analysis of the structure of indebtedness. Preliminary content of the work • Introduction to the topic • Literature review and theoretical framework • Development of households’ indebtedness and possible implications for financial stability • Data analysis • Results • International comparison • Conclusion Literature used SETTLEMENTS, Bank for International, Household Debt: Implications for Monetary Policy and Financial Stability (May 1, 2009). BIS Paper No. 46. Available at SSRN: http://ssrn.com/abstract=1425005 ČNB, Zpráva o finanční stability 2012/2013, Available at: http://www.cnb.cz/miranda2/export/sites/www.cnb.cz/cs/financni_stabilita/zpravy_fs/fs_2012-2013/fs_2012-2013_realna_ekonomika.pdf NAKORNTHAB Don, 2010."Household Indebtedness and Its Implications for Financial Stability," Research Studies, South East Asian Central Banks (SEACEN) Research and Training Centre, number rp80, August. ČERNOHORSKÁ, L. - LINHARTOVÁ, V. Analýza zadluženosti domácností. Scientific Papers of the University of Pardubice, Series D, Faculty of Economics and Administration, 2011, vol. 16, no. 22, s. 31-43. ISSN: 1211-555X. FILARDO, A. Household debt, monetary policy and financial stability: still searching for a unifying model. BIS papers, no. 46, s. 31-50. DEBELLE, G. 2004. Household Debt and the Macroeconomy. BIS papers. Available at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1968418 ŠEDOVÁ, J. 2011. Household Indebtedness Risks in the Czech Republic. World Academy of Science, Engineering and Technology, no. 60 |