Do Liquidity Constraints and Interest Rates Matter for Consumer Behavior? Evidence from Credit Card Data

This paper utilizes a unique new dataset of credit card accounts to analyze how people respond to changes in credit supply. The data consist of a panel of thousands of individual credit card accounts from several different card issuers, with associated credit bureau data. We estimate both marginal propensities to consume (MPCs) out of liquidity and interest-rate elasticities. We also evaluate the ability of different models of consumption to rationalize our results, distinguishing the Permanent-Income Hypothesis (PIH), liquidity constraints, precautionary saving, and behavioral models. We find that increases in credit limits generate an immediate and significant rise in debt, counter to the PIH. The average 'MPC out of liquidity' (dDebt/dLimit) ranges between 10%-14%. The MPC is much larger for people starting near their limits, consistent with binding liquidity constraints. However, the MPC is significant even for people starting well below their limit. We show this response is consistent with buffer-stock models of precautionary saving. Nonetheless there are other results that conventional models cannot easily explain, e.g. why so many people are borrowing on their credit cards, and simultaneously holding low yielding assets. Unlike most other studies, we also find strong effects from changes in account-specific interest rates. The long-run elasticity of debt to the interest rate is approximately -1.3. Less than half of this elasticity represents balance-shifting across cards, with most reflecting net changes in total borrowing. The elasticity is larger for decreases in interest rates than for increases, which can explain the widespread use of temporary promotional rates. The elasticity is smaller for people starting near their credit limits, again consistent with liquidity constraints.

An Empirical Analysis of Personal Bankruptcy and Delinquency

This paper uses a unique new panel data set of credit card accounts to analyze credit card delinquency and more generally personal bankruptcy and the stability of credit risk models. We estimate duration models for default and assess the relative importance of different variables in predicting default. We investigate how the propensity to default has changed over time, disentangling the two leading explanations for the recent increase in default rates – a deterioration in the risk-composition of borrowers versus a reduction in the social stigma of default. Even after controlling for risk-composition and other economic fundamentals, the propensity to default significantly increased between 1995 and 1997. By contrast, increases in credit limits and other changes in risk-composition explain only a small part of the change in default rates. Standard default models appear to have missed an important time-varying default factor, consistent with the stigma effect.Personal bankruptcy; Forecasting default; Credit risk management; Consumer credit; Credit cards

An Empirical Analysis of Personal Bankruptcy and Delinquency

This paper uses a new panel data set of credit card accounts to analyze credit card delinquency, personal bankruptcy, and the stability of credit risk models. We estimate duration models for default and assess the relative importance of different variables in predicting default. We investigate how the propensity to default has changed over time, disentangling the two leading explanations for the recent increase in default rates - a deterioration in the risk - composition of borrowers versus an increase in borrowers' willingness to default due to declines in default costs, including social, information, and legal costs. Even after controlling for risk-composition and other economic fundamentals, the propensity to default significantly increased between 1995 and 1997. By contrast, increases in credit limits and other changes in risk-composition explain only a small part of the change in default rates. Standard default models appear to have missed an important time-varying default factor, consistent with a decline in default costs.

Importance of site of infection and antibiotic selection in the treatment of carbapenem-resistant Pseudomonas aeruginosa sepsis

ABSTRACT In a retrospective analysis of 215 patients with carbapenem-resistant Pseudomonas aeruginosa sepsis, we observed a significantly higher risk of mortality associated with respiratory tract infection (risk ratio [RR], 1.20; 95% confidence interval [CI], 1.04 to 1.39; P = 0.010) and lower risk with urinary tract infection (RR, 0.80; 95% CI, 0.71 to 0.90; P = 0.004). Aminoglycoside monotherapy was associated with increased mortality, even after adjusting for confounders (adjusted RR, 1.72; 95% CI, 1.03 to 2.85; P = 0.037), consistent across multiple sites of infection. </jats:p

Cotton-Textile-Apparel sectors of Pakistan: Situations and challenges faced

"Cotton, textiles, and apparel are critical agricultural and industrial sectors in Pakistan. This study provides descriptions of these sectors and examines the key developments emerging domestically and internationally that affect the challenges and opportunities they face. One-quarter of Pakistani farmers, of whom about 40 percent have household incomes below the poverty line, grow cotton. Export controls and taxes kept cotton prices below international levels until the mid-1990s but have subsequently tracked export parity international levels following reforms to trade and pricing policies and a greater role for the private sector. Pakistani farmers have not formally adopted genetically modified Bt cotton but there is some field evidence of its unregulated use. Despite constraints in its production, storage, and ginning sectors, the production of cotton yarn increased at an annual rate of 4.7 percent during 1990–2005 and Pakistan's share of world output increased to nearly 10 percent. Cotton-related products account for nearly 60 percent of Pakistan's export earnings. The textile industry still produces mostly fabrics of relatively low count (low quality) although it has been successful in expanding its exports of some higher-value products. The industry will need further entrepreneurial initiatives to remain competitive in international markets. Among the farm households that produce cotton, about 40 percent of total income comes from its production. The decline in world prices that occurred in the late 1990s adversely affected these households. Household-level simulations suggest that a counterfactual 20 percent increase of cotton prices, which reflects the extent to which real cotton prices declined in Pakistan during this period, would have reduced the percentage of cotton-producing households below the poverty line in 2001 from 40 percent to 28 percent. The estimated effect from declining cotton prices explains about one-sixth of the overall observed increase of rural poverty in the period." from authors' abstractCotton, textiles, Apparel, Rural poverty, subsidies, Industry policy, World markets, Globalization, Markets, trade,

High Coherence Plane Breaking Packaging for Superconducting Qubits

We demonstrate a pogo pin package for a superconducting quantum processor specifically designed with a nontrivial layout topology (e.g., a center qubit that cannot be accessed from the sides of the chip). Two experiments on two nominally identical superconducting quantum processors in pogo packages, which use commercially available parts and require modest machining tolerances, are performed at low temperature (10 mK) in a dilution refrigerator and both found to behave comparably to processors in standard planar packages with wirebonds where control and readout signals come in from the edges. Single- and two-qubit gate errors are also characterized via randomized benchmarking. More detailed crosstalk measurements indicate levels of crosstalk less than -40 dB at the qubit frequencies, opening the possibility of integration with extensible qubit architectures.Comment: 9 pages, 5 figures, 2 table

Role of a plausible nuisance contributor in the declining obesity-mortality risks over time.

CONTEXT: Recent analyses of epidemiological data including the National Health and Nutrition Examination Survey (NHANES) have suggested that the harmful effects of obesity may have decreased over calendar time. The shifting BMI distribution over time coupled with the application of fixed broad BMI categories in these analyses could be a plausible nuisance contributor to this observed change in the obesity-associated mortality over calendar time. OBJECTIVE: To evaluate the extent to which observed temporal changes in the obesity-mortality association may be due to a shifting population distribution for body mass index (BMI), coupled with analyses based on static, broad BMI categories. DESIGN, SETTING, AND PARTICIPANTS: Simulations were conducted using data from NHANES I and III linked with mortality data. Data from NHANES I were used to fit a true model treating BMI as a continuous variable. Coefficients estimated from this model were used to simulate mortality for participants in NHANES III. Hence, the population-level association between BMI and mortality in NHANES III was fixed to be identical to the association estimated in NHANES I. Hazard ratios (HRs) for obesity categories based on BMI for NHANES III with simulated mortality data were compared to the corresponding estimated HRs from NHANES I. MAIN OUTCOME MEASURES: Change in hazard ratios for simulated data in NHANES III compared to observed estimates from NHANES I. RESULTS: On average, hazard ratios for NHANES III based on simulated mortality data were 29.3% lower than the estimates from NHANES I using observed mortality follow-up. This reduction accounted for roughly three-fourths of the apparent decrease in the obesity-mortality association observed in a previous analysis of these data. CONCLUSIONS: Some of the apparent diminution of the association between obesity and mortality may be an artifact of treating BMI as a categorical variable