پرورش بحرانهای غیراصلی فرد: اثرات بازار کار بر ثبات سیستم مالی

Crisis may spread through economy via the propagating mechanisms of the labour market – households becoming delinquent due to an initial unemployment shock may be unable to continue servicing obligations versus the financial system. With large debts – e.g. mortgages – such defaults pose a threat to financial system stability. In this paper we use the Polish household budget surveys to simulate the impact of changes in the labour market status of household members on the ability of the household to service its mortgage payments. The simulation results are subsequently aggregated to facilitate a macro-level interpretation of the findings. We simulate various scenarios of labour market deterioration. Finally, we also introduce a policy instrument into the simulations providing, in a fiscally neutral manner, additional stability to the financial system. Based on robustness checks, the findings seem to be reliable. The results suggest that even with shares of debtors among consumers as low as in Poland, the propagation mechanism may indeed result in a considerable threat, while the fiscally neutral instrument is effective and well-suited to be addressed in providing additional stability to the financial syste

In most theoretical approaches, creditworthiness is evaluated based on one's likelihood to service the future burden of repayments. The future liquidity position of debtors remains unknown at the time of credit approval, which is the core of risk associated with the approval decision. For mortgages, it has been frequently argued in the literature that scoring models can help to partly alleviate this problem by allocating potential clients a different probability of becoming delinquent over the credit horizon. Scoring models rely on proxies (e.g. demographic status, educational attainment) to forecast future labour market prospects (Wagner, 2004). Consequently, these models evaluate future earnings using a Heckman corrected Mincerian approach. However, such models may prove unreliable in the context of large swings in the unemployment rate, since such periods are typically associated with out-of-equilibrium labour market behaviour. Such swings are frequent in the context of developing or transition countries, but also occur in highly industrialised countries (e.g. Finland in the mid 1990s or Ireland and Spain over the 2007–2009 period).

Gorton (2008) analyses in detail the origins of the recent financial distress in the US, describing how the banking system crisis emerged in the US from mortgage difficulties in the so-called sub-prime segment of the market. There seems to be a consensus in the literature that the sub-prime crisis stemmed from lax lending standards by the financial institutions. However, the important conclusion that emerges from this analysis for any economy concerns the nature of distress risk in the financial system. Labour market contraction may affect debtor households sufficiently severely to harm the individual capacity to service the debts. If the change in labour demand is large enough, the number of households falling behind on the monthly mortgage instalments may indeed be large enough to pose a threat to the financial system stability.