Household Behavior towards Debt in a Challenging Financial Environment in Malaysia
DOI:
https://doi.org/10.21834/ajbes.v2i7.39Abstract
The study of household behaviour towards debt is important in this challenging financial environment. Escalating household debt can cause social and economic problems. For the past few years Malaysia has emerged as the highest household debt country in the ASEAN region. Therefore this study aims to examine the predictors of intention to incur household debt among Malaysian households. Analysis on 100 usable questionnaires in the pilot study revealed financial literacy and subjective norm as significant predictors of attitude and the mediating relationship between attitude and intention to incur on household debt was found to be negatively significant.
Keywords: Household behaviour; household debt; financial environment; financial literacy
2398-4295 © 2017 The Authors. Published for AMER ABRA by e-International Publishing House, Ltd., UK. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/). Peer–review under responsibility of AMER (Association of Malaysian Environment-Behaviour Researchers), ABRA (Association of Behavioural Researchers on Asians) and cE-Bs (Centre for Environment-Behaviour Studies), Faculty of Architecture, Planning & Surveying, UniversitiTeknologi MARA, Malaysia.
References
Ajzen, I. (1991). The theory of planned behavior. Organizational Behavior and Human Decision Processes, 50(2), 179–211.
Ajzen, I. (2008). Consumer attitudes and behavior. Handbook of Consumer Psychology, 525–548.
Ajzen, I., & Fishbein, M. (1977). Attitude-Behavior Relations: A Theoretical Analysis and Review of Empirical Research. Psychological Bulletin, 84(5), 888–918.
American Association of University Women [AAUW]. (2010). Financial Literacy. Retrieved from www.aauw-ca.org/index.cfm/go/pages.view/page/financial-literacy
Carpenter, T. D., & Reimers, J. L. (2005). Unethical and Fraudulent Financial Reporting: Applying the Theory of Planned Behavior. Journal of Business Ethics, 60(2), 115–129.
Chudry, F., Foxall, G., & Pallister, J. (2011). Exploring Attitudes and Predicting Intentions: Profiling Student Debtors Using an Extended Theory of Planned Behavior. Journal of Applied Social Psychology, 41(1), 119–149.
Guiso, L., & Jappeli, T. (2008). Financial Literacy and Portfolio Diversification. EUI Working Papers, ECO 2008/31.
Jorgensen, B. L., & Savla, J. (2010). Financial Literacy of Young Adults: The Importance of Parental Socialization. Family Relations, 59(4), 465–478.
Kennedy, B. P. (2013). The theory of planned behavior and financial literacy: A predictive model for credit card debt? Dissertation, (August).
Kennedy, B. P., & Wated, G. (2011). Predicting credit card debt among college students: The attitudes-behavior relation. Journal of Psychology and Behavioral Sciences, 22, 43–50.
Lea, S. E. G., Webley, P., & Walker, C. M. (1995). Psychological factors in consumer debt: Money management, economic socialization, and credit use. Journal of Economic Psychology, 16(4), 681–701.
Madden, T., Ellen, P., & Ajzen, I. (1992). A comparison of the theory of planned behavior and the theory of reasoned action. Personality and Social Psychology Bulletin, 18.
Pattarin, F., & Cosma, S. (2012). Psychological determinants of consumer credit: the role of attitudes. Review of Behavioral Finance, 4(2), 113–129.
Rooij, M. Van, Lusardi, A., & Alessie, R. (2007). Financial Literacy and Stock Market Participation. National Bureau of Economic Research Working Paper Series, No. 13565(Working Paper 13565), 1–48.
Rutherford, L. G., & Devaney, S. A. (2009). Utilizing the Theory of Planned Behavior to Understand Convenience Use of Credit Cards. Journal of Financial Counseling and Planning, 20(2).
Shim, S., Xiao, J. J., Barber, B. L., & Lyons, A. C. (2009). Pathways to life success: A conceptual model of financial well-being for young adults. Journal of Applied Developmental Psychology, 30(6), 708–723.
Stone, B., & Maury, R. V. (2006). Indicators of personal financial debt using a multi-disciplinary behavioral model. Journal of Economic Psychology, 27(4), 543–556.
Tokunaga, H. (1993). The use and abuse of consumer credit: Application of psychological theory and research. Journal of Economic Psychology, 14(2), 285–316.
Xiao, J. J., Tang, C., Serido, J., & Shim, S. (2011). Antecedents and consequences of risky credit behavior among college students: Application and extension of the Theory of Planned Behavior. Journal of Public Policy & Marketing, 30(2), 239–245.
Zhu, L. Y., & Meeks, C. B. (1994). Effects of low income families’ ability and willingness to use consumer credit on subsequent outstanding credit balances. Journal of Consumer Affairs, 28(2), 403–422.
