TP9: Consumer Credit Decisions in a Dual-Process Perspective

Principal Investigator: Erik Hölzl

Research Team: Michael Blens

Consumer credit is a widespread phenomenon. With recent new credit forms that foster more spontaneous decisions (e.g., in-store credit, instant credit), it is likely that credit decisions of consumers become less reflective. This project will focus on the interplay of automatic and controlled processes in credit decisions. It pursues two research lines, borrowing and repaying, each focusing on specific decisions consumers make in the phases before and after signing a credit contract. Research line I (borrowing) examines (a) consumer decisions when choosing between different credit offers and (b) consumer decisions regarding acceptance of instant credit offers. Research line II (repaying) examines (a) consumer decisions when managing several open credit accounts that need repaying and (b) consumer decisions regarding tempting new purchasing opportunities while still having the obligation to repay an open credit. Building on dual-process theories, self-regulation and mental accounting theories, the project examines these decisions. The project has theoretical implications for dual processes in financial decision-making. Practical implications concern individual consumers, consumer counselling organizations, banks and credit institutions. In addition, results can inform public policy, in particular consumer policy..


Working Papers

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