ILLIQUIDITY TRAP: OVER-INDEBTED SUBJECTS AND THEIR COGNITIVE CONSEQUENCES/Trampa de iliquidez: Los sujetos sobreendeudados y sus consecuencias cognitivas/Armadilha de iliquidez: Sujeitos superendividados e suas consequencias cognitivas

This research aims to show the cognitive constraints experienced by resulting from financial concerns and problems. A case study was conducted involving eight individuals living in different Colombian cities, who got into debt and faced an insolvency process. The results obtained are consistent with...

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Bibliographic Details
Published in:Revista de administração de emprêsas 2024-01, Vol.64 (1)
Main Authors: Toro-Garcia, Guillermo Leon, Cobo, Sandra Balanta, Castellanos, Alexander Alegria
Format: Article
Language:Portuguese
Online Access:Get full text
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Summary:This research aims to show the cognitive constraints experienced by resulting from financial concerns and problems. A case study was conducted involving eight individuals living in different Colombian cities, who got into debt and faced an insolvency process. The results obtained are consistent with the theoretical-empirical framework proposed by Mullainathan and Shafir (2013), regarding the cognitive strain experienced by individuals with feeling of scarcity. This work contributes to the existing empirical literature and represents a first step toward the existence of a debt illiquidity trap that drives debtors to perpetuate their critical financial situation.
ISSN:0034-7590
DOI:10.1590/S0034-759020240103x