ESSAYS ON ECONOMIC BEHAVIOUR OF LOAN REPAYMENT: EVIDENCE FROM HOUSEHOLD AND CORPORATE LOAN MARKETS

Abstract

This PhD thesis bundles three empirical essays on the topic of economic behavior of loan repayment by households and corporations, aiming to help enrich our understanding of three aspects of the economics of loan repayments by households and corporations: (1) residential mortgage default behavior, (2) residential mortgage partial prepayment behavior, and (3) corporate default risk. The first essay studies whether heterogeneity in borrowers? time preferences correlates with their decision to default on their mortgage payments. The second essay studies the likelihood of making partial prepayments of mortgages and the process through which mortgage borrowers learn to make partial prepayment decisions in the residential mortgage market in China. The third essay studies information beyond accounting and market variables in predicting the default of Chinese-listed companies. Thus, this thesis ultimately contributes to the extant literatures of behavior of debtors in repaying their financial obligations.