Household Debt and Household Spending Behavior: Evidence from Malaysia

Household Debt and Household Spending Behavior: Evidence from Malaysia. Jurnal Ekonomi Malaysia, 54 (1). pp. 111-120. ISSN 2716-6058 (2020)


Using data collected from urban households in the Klang Valley, Malaysia, this study examined the impact of household
debt on urban household consumption decisions. The findings revealed that household debt does not generally affect
consumption decisions, except in the case of expenditure on vacation, which tends to be reduced for households
facing high levels of debt. Furthermore, general financial wellness tends to be the main factor affecting consumption
rather than debt. Households with poorer financial wellness make more frequent cuts to daily meals, fruit, utility,
transportation, clothing, medical care, vacations, and leisure activities. Although the impact of debt on consumption
is not extensive, it must be closely monitored to ensure that the risk is contained and that the wellbeing of households
is not adversely affected.

Item Type: Article
Keywords: Household debt, spending cut, investment loan, consumption loan, Malaysia
Taxonomy: By Subject > Business & Management > Finance
Local Content Hub: Subjects > Business & Management
Depositing User: Eza Eliana Abdul Wahid
Date Deposited: 01 Aug 2021 13:49
Last Modified: 01 Aug 2021 13:49
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