Household Debt and Financial Burden in Mexico
- 1 Faculty of Economics, Autonomous University of Coahuila, Saltillo, Mexico
- 2 Faculty of Economics, Autonomous University of Coahuila, Saltillo, Mexico
- 3 Center for Socioeconomic Research, Autonomous University of Coahuila, Saltillo, Mexico
Abstract
The objective of this work is to determine the debt index and identify the financial burden of households in Mexico for 2014 by using the data from ENIGH 2014. The hypothesis to be tested is that during the last few years, households in Mexico are accelerating their dependence on debt to satisfy their consumption and housing needs, which is added to disproportionate interest rates, considerably increases their financial burden, which in many cases slows down or leads to the bankruptcy of the economy of these households. The results indicate that households in the first three deciles are in unsustainable conditions and do not have the financial capacity to meet their expenses and debts, while households in the fourth, fifth and sixth deciles are at financial risk.
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