Racial Disparities in Debt Collection

Jessica LaVoice and Domonkos F. Vamossy

Abstract: This paper shows that black and Hispanic borrowers are 39% more likely to experience a debt collection judgment than white borrowers, even after controlling for credit scores and other relevant credit attributes. The racial gap in judgments is more pronounced in areas with a high density of payday lenders, a high share of income-less households, and low levels of tertiary education. State-level measures of racial discrimination cannot explain the judgment gap, nor can neighborhood-level differences in the previous share of contested judgments or cases with attorney representation. A back-of-the-envelope calculation suggests that closing the racial wealth gap could significantly reduce the racial disparity in debt collection judgments.

Date: 2019-10, Revised 2023-06
References: Add references at CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/1910.02570 Latest version (application/pdf)

Related works:
Journal Article: Racial disparities in debt collection (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:1910.02570

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().