42. Preliminary Investigation on the Determinants of Household Debt Burden

The study of household debt burden is important because households are an essential element of each social and economic system. This means that any debt-service problems that they encounter will portray a negative influence on the whole economy in the long run. Further, household debt is currently becoming a very crucial social and economic problem for both highly developed countries and emerging markets (including ASEAN). This paper attempts to conduct a preliminary investigation on the determinants of household debt burden by looking first at the trend of household debt in some advanced economies and emerging ASEAN countries. It will also review some macroeconomic factors inherent in household debt burden, namely, interest rate, inflation rate, housing price index, unemployment rate, and aggregate consumer consumption. Accordingly, the aim of this paper is to produce a conceptual framework and discuss the methodology process involved. It is hoped that the evidences laid out from previous literatures on the importance of solving the household debt burden issue, in some way, have caused the curiosity for further investigation in determining, uncovering, and validating the determinant factors that may affect household debt burden in the selected countries under this study.