|
Field
Abstract
|
Before
In this study, we estimate the effect of information disclosure on credit card borrowing choices. In an online survey experiment, participants must choose whether they want to borrow on a revolving credit card for consumption. For each hypothetical choice, both the borrowing amount and APR can take one of three possible values. We have three treatments: i) participants are shown the borrowing amount and APR only, ii) in addition, participants are shown the dollar value of the interest they would pay if they do not pay off their credit card debt for one month, or iii) in addition, they are shown the annual interest amount if they do not make any payments on the credit card for one year.
|
After
In this study, we estimate the effect of information disclosure on credit card borrowing choices. In an online survey experiment, participants must choose whether they want to borrow on a revolving credit card for consumption. For each hypothetical choice, the borrowing amount can take one of five possible values and the APR can take one of three possible values. We have three treatments: i) participants are shown the borrowing amount and APR only, ii) in addition, participants are shown the dollar value of the interest they would pay if they do not pay off their credit card debt for one month, or iii) in addition, they are shown the annual interest amount if they do not make any payments on the credit card for one year.
|