@article{6fab8530b5804faabdc35cfad5e3b946,
title = "The effects of disclosure and enforcement on payday lending in Texas",
abstract = "In 2012, Texas and two municipalities therein adopted regulations governing the payday loan market. Austin and Dallas enacted supply restrictions limiting the loan-to-income ratio and mandating amortization. The state adopted an information disclosure inspired by Bertrand and Morse (2011) presenting the cost and typical usage of payday loans in easy-to-understand terms. We find that the municipal restrictions led to a 61% decline in loan volume in Austin and a 44% decline in Dallas, with the effects driven by the start of enforcement. The statewide disclosures led to a persistent 12% decline in loan volume in the first six months.",
keywords = "Disclosure, Enforcement, Financial regulation, Payday lending",
author = "Jialan Wang and Kathleen Burke",
note = "Toni Whited was the editor for this article, and we are thankful to her and an anonymous referee for helpful comments. We are grateful to Sean Hundtofte, Carlos Parra, and Victor Stango and participants at the American Law and Economics Association, CFPB, FDIC Consumer Research Symposium, National University of Singapore, and SFS Cavalcade for valuable comments. We are thankful to Jesse Leary for contributing to an earlier version of this paper, circulated as “Information Disclosure and Payday Lending in Texas,” and to Yucheng Zhou, Yunrong Zhou, Renhao Jiang, Deepti Kumari, Di (Freddy) Li, Peichen Li, Bo Lyu, Prarthana Patel, Umang Khetan, Vikas Venkatapathy, Lihan Yu, Filipe Correia, and Peter Han for research assistance. The views expressed are those of the authors and do not necessarily represent those of the Consumer Financial Protection Bureau or the United States, and should not be interpreted as those of the Congressional Budget Office. Any errors are our own.",
year = "2022",
month = aug,
doi = "10.1016/j.jfineco.2021.09.024",
language = "English (US)",
volume = "145",
pages = "489--507",
journal = "Journal of Financial Economics",
issn = "0304-405X",
publisher = "Elsevier B.V.",
number = "2",
}