UC Irvine

To advance our understanding of debt and credit, my dissertation provides a comprehensive sociological examination of household level credit consumption—both within the US and in the European Union. I attempt to account for how both supply and demand side social forces—cultural and structural—simultaneously drive indebtedness. I address three questions. First, how does class position mediate the influence of structural and cultural forces on U.S. households’ levels of indebtedness? Second, has acceptance of debt in U.S. households changed with intensified financialization? Third, how do welfare-state provisions influence households’ indebtedness across countries over time? In Chapter 2, I show that credit consumption is class-contingent. Specifically, using Survey of Consumer Finances (SCF) data for 2010, I find that upper class households use their credit to make financial investments, ostensibly in the service of wealth creation. The middle classes are interested in using their homes as investment in long term security, and the upper middle class (along with the upper class) does use some of its credit to engage in status based, positional consumption. In contrast, the lower classes deploy their debts to make ends meet. They use credit to pay for basic necessities and also to fund education. In Chapter 3, I approach the issue of debt and finance culture from a longer-term perspective, interrogating the contours of the ‘norm of debt acceptability’ over the 1989 to 2016 period, using SCF. I extend my examination beyond general debt acceptance levels, by interrogating how acceptable households find using credit for 5 specific kinds of purposes. Surprisingly, I find that social class membership is less important in patterning how households think about credit than it is in determining actual credit consumption and debt. One interesting pattern is that American households’ understandings of the appropriate uses of credit shifted substantially in the mid-1990s, when Americans, regardless of position in the social structure, moved away from seeing credit as a means by which households may furnish frivolous/luxury consumption to a view where credit is recognized as an important tool to deal with economic constraint. Interestingly, credit use in general is considered less acceptable to upper class households, and more acceptable to poor households, likely reflecting the structural need to rely on credit. In Chapter 4, contrary to most scholarship on the credit/welfare nexus, I find a complementary, rather than substitutive relationship between state spending levels and the total amount of household indebtedness in European Union countries, using hierarchical linear models of EU SILC data, 2004-2015. I also uncover that time exerts a positive impact on household debt amount, as does degree of financialization. I argue that the welfare regime/household credit tradeoff proposition needs rethinking for different institutional environments. On the whole, my dissertation provides a multidimensional understanding of debt, and advances economic sociology and the study of finance by integrating it with issues of social stratification and by considering how structural and cultural forces jointly shape household indebtedness across space and time.