Household indebtedness has grown sharply in the United Kingdom in recent years. This paper proposes a framework for understanding this based on a model in which households are assumed to plan their lifetime spending rationally, allowing for bequests to future generations. The model is set up to...

This paper considers the causes of the rise in US household debt since the early 1970s using a calibrated partial equilibrium overlapping generations model. The model explains indebtedness in terms of a consumption-income motive, associated with consumption smoothing, and a housing-finance...

This article summarises the main results of a survey carried out for the Bank in September 2004 about household borrowing, housing wealth and attitudes to debt. The survey was designed to provide a comprehensive, up-to-date picture of household indebtedness. It found significant differences...

The financial position of British households has been affected by a number of developments over the past year, including sharp fluctuations in food and energy bills, falling house prices and tighter credit conditions. Evidence from the latest survey of households, carried out for the Bank by NMG...

This article summarises the main results from the latest survey carried out for the Bank by NMG Research in late September about the state of household finances. There was a slight increase in financial pressure among renters, continuing a recent trend. Mortgagors appeared not to have...

There is considerable uncertainty about the effect of household debt on the macroeconomy and its role in the monetary transmission mechanism. This article summarises conclusions from recent Bank of England research aimed at shedding light on this issue. It argues that the extent to which levels...