Expectations and House Leverage

Michael Weber, Assistant Professor of Finance
Constantine Yannelis, Assistant Professor of Finance and FMC Faculty Scholar

We aim to study how expectations and beliefs affect household borrowing decisions. Specifically, we want to explore expectations regarding possible events, such as student loan forgiveness and higher future inflation. Expectations about future loan forgiveness, or wage and price increases, may affect loan repayment, leverage decisions, investment, and asset accumulation today. We aim to build new data, linking survey evidence to credit panel data and write several papers using this new data.