Mortgage loan securitization and personal consumption smoothening
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- 作者：Jenny Gu ; Rodrigo J. Hernandez ; Pu Liu ; Yingying Shao
- 关键词：Securitization ; Mortgage loans ; Consumption smoothening
- 刊名：Journal of Economics and Finance
- 出版年：2017
- 出版时间：January 2017
- 年：2017
- 卷：41
- 期：1
- 页码：100-115
- 全文大小：
- 刊物主题：Economics, general; Macroeconomics/Monetary Economics//Financial Economics; Finance, general;
- 出版者：Springer US
- ISSN：1938-9744
- 卷排序：41
文摘
In this paper we examine the extent to which personal consumptions are sheltered from state-specific economic shocks because of banks’ mortgage loan securitizations. We posit that securitization contributes to personal consumption smoothening due to securitizations’ positive effect on banks’ credit supply, which reduces consumers’ consumption constraints during economic shocks. Using data for U. S. banks’ mortgage loan securitizations from 1989 to 2008, we show that personal consumption smoothening is positively related to securitization. The finding of a significant relationship between loan securitizations and consumption smoothening contributes to the continuing debate on the role of financial innovation in real economy.