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Table 8.
Transitions from Borrower-Saver to Saver and from Saver to Borrower-Saver
(1)(2)(3)(4)
P SS P
BaselineStrictBaselineStrict
Change in predicted −0.014 −0.017 0.032*** 0.036*** 
credit access risk (0.010) (0.021) (0.012) (0.013) 
Change in job shock −0.001 −0.003 −0.006 0.007 
 (0.011) (0.027) (0.011) (0.018) 
Present bias 0.011 0.018 −0.003 −0.000 
 (0.018) (0.039) (0.021) (0.025) 
High discount rate −0.038** −0.108*** 0.042** 0.026 
 (0.018) (0.040) (0.020) (0.023) 
Middle risk aversion −0.008 −0.027 0.056** 0.075*** 
 (0.019) (0.040) (0.022) (0.026) 
Financial literacy 0.011 −0.005 −0.009 −0.029 
 (0.020) (0.043) (0.025) (0.030) 
Financial −0.021 −0.033 −0.021 0.023 
self-knowledge (0.019) (0.044) (0.024) (0.028) 
L4: Net worth 0.007 0.015 −0.013*** −0.001 
 (0.006) (0.010) (0.005) (0.005) 
L4: Homeowner, −0.006 0.184*** −0.027 −0.084 
with mortgage (0.032) (0.065) (0.034) (0.052) 
L4: Homeowner, 0.014 0.185** −0.111*** −0.173*** 
no mortgage (0.046) (0.088) (0.035) (0.056) 
L4: Has car loan −0.056*** −0.064* 0.071*** 0.050** 
 (0.018) (0.037) (0.021) (0.025) 
L4: Has student debt −0.094*** −0.046 0.177*** 0.072 
 (0.029) (0.091) (0.055) (0.077) 
Year = 2012 0.020 0.083 0.021 0.040 
 (0.044) (0.089) (0.045) (0.056) 
Observations 2,503 722 2,014 1,092 
R2 0.05 0.12 0.09 0.10 
(1)(2)(3)(4)
P SS P
BaselineStrictBaselineStrict
Change in predicted −0.014 −0.017 0.032*** 0.036*** 
credit access risk (0.010) (0.021) (0.012) (0.013) 
Change in job shock −0.001 −0.003 −0.006 0.007 
 (0.011) (0.027) (0.011) (0.018) 
Present bias 0.011 0.018 −0.003 −0.000 
 (0.018) (0.039) (0.021) (0.025) 
High discount rate −0.038** −0.108*** 0.042** 0.026 
 (0.018) (0.040) (0.020) (0.023) 
Middle risk aversion −0.008 −0.027 0.056** 0.075*** 
 (0.019) (0.040) (0.022) (0.026) 
Financial literacy 0.011 −0.005 −0.009 −0.029 
 (0.020) (0.043) (0.025) (0.030) 
Financial −0.021 −0.033 −0.021 0.023 
self-knowledge (0.019) (0.044) (0.024) (0.028) 
L4: Net worth 0.007 0.015 −0.013*** −0.001 
 (0.006) (0.010) (0.005) (0.005) 
L4: Homeowner, −0.006 0.184*** −0.027 −0.084 
with mortgage (0.032) (0.065) (0.034) (0.052) 
L4: Homeowner, 0.014 0.185** −0.111*** −0.173*** 
no mortgage (0.046) (0.088) (0.035) (0.056) 
L4: Has car loan −0.056*** −0.064* 0.071*** 0.050** 
 (0.018) (0.037) (0.021) (0.025) 
L4: Has student debt −0.094*** −0.046 0.177*** 0.072 
 (0.029) (0.091) (0.055) (0.077) 
Year = 2012 0.020 0.083 0.021 0.040 
 (0.044) (0.089) (0.045) (0.056) 
Observations 2,503 722 2,014 1,092 
R2 0.05 0.12 0.09 0.10 

The dependent variable is a dummy variable equal to 1 if the transition from borrower-saver to saver occurred, PS (or from saver to borrower-saver SP) and 0 if the respondent remained in the same group. All regressions also control for formal knowledge (years of completed education) and AFQT scores; demographics (age, race, gender, marital status, and the number of children); county controls for local economic conditions; and state fixed effects. Bootstrapped standard errors with 1000 repetitions (in parentheses) are clustered at the individual level. Significant at ***1%, **5%, and *10%.

Source: NLSY79.

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