Credit and voting
Published: 27 November 2024
This paper detects how credit constraints for subprime borrowers affect political polarization in the U.S.
Discussant: Saurabh Lall
Wed. 27 November 2024 ‖ 3:00-4:30pm ‖ ARC 225 ‖ Global Political Economy cluster
Abstract: We investigate how credit constraints for subprime borrowers affect political polarization in the U.S. Using proprietary data on credit reports for 1% of the U.S. population over 15 years, we detect exogenous discontinuities in access to credit. We combine this data with Congressional elections and find that more credit-constrained individuals increase the Republican vote share. We rationalize this finding through political alignment among Republicans for laxer regulation of credit and mortgage markets. Our results are robust to trade exposure.
First published: 27 November 2024
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