Replication Package: Removing the Fine Print: Standardized Products, Disclosure, and Consumer Outcomes

Description

Hidden fees can distort consumer decision-making. In response, regulators historically have (a) improved disclosure to make fees more salient or (b) standardized products to restrict what fees can be charged. We use Chilean administrative data and a multi-stage natural experiment to separately identify the effects of disclosure and standardization on repayment. We find that disclosure reduces delinquencies by 13.7 percentage points (40%) and default by 1.68 percentage points (98%), whereas standardization has no effect. We find no effect on initial loan terms, suggesting that disclosure’s effects are specific to repayment behavior: specifically, disclosure improves borrowers’ understanding of their credit obligations. This repository holds the replication package for "Removing the Fine Print: Standardized Products, Disclosure, and Consumer Outcomes". It includes the analysis code and the publicly available datasets, along with the CMF's letter approving the authors' use of the confidential data. The confidential data itself is **not** included — researchers must apply to the CMF for access (see the README). Start with 'README.md' to learn how to run the code and replicate the results.

Institutions

• University of Virginia

  Virginia, Charlottesville

Categories

Funders

• Fondecyt

  Grant ID: #11200010
• Alfred P. Sloan Foundation

  New York

Licence