Borrowers’ Distress and Debt Relief: Evidence from a Natural Experiment
利用印度2008年债务豁免计划的自然实验，研究发现债务减免对非困境借款人的后续贷款表现有负面影响，而对困境借款人则有改善作用，揭示了不同借款人之间的关键差异。
Using unique borrower-level data, we study the causal effect of debt relief on the loan performance of distressed and nondistressed borrowers. We employ a regression discontinuity design that exploits exogenous cutoff dates underlying the 2008 Indian debt waiver program to separate defaulters on loans into beneficiaries and nonbeneficiaries of waivers. By identifying distress before the waiver program using exogenous borrower-level shocks, we examine performance on loans originated after the waiver program. Loan performance of nondistressed beneficiaries worsens, while that of distressed borrowers improves. While existing studies aggregate the effects of debt relief across distressed and nondistressed borrowers, we highlight crucial differences between them.