Using Mixed-methods in Cross-disciplinary Research

ISBN-10
1526462702
ISBN-13
9781526462701
Category
Interest rates
Language
English
Published
2019
Author
Ben O. Lukongo

Description

This case study tells the story of my experiences related to building a loan accessibility index for the first time in the economics of consumer finance literature. Historical records suggest that the Constitution of Arkansas of 1874 fixed the maximum interest at 10% for all loans and the Amendment 89 of November 2010 to the Arkansas Constitution increased the maximum from 10% to 17%. This case study uses mixed methods as a research strategy. The case study of the state of Arkansas in the United States is interesting because it provides a natural experiment of the adverse consequence of constitutionally imposed interest rate cap. The latter is the binding interest rate that consumers shall pay to have access to loans. As set at this level, it becomes illegal for lenders to charge above the rate of 17%. However, the five surrounding states do not have interest rate cap. Data suggest that lenders left the state and went across the borders to provide loans to consumers. The insight gained from this case study will both empower and guide readers in their future research projects. Overall, proximity to the Border States makes a big difference in the access to installment loans. Arkansans living in the interior of the state have limited access or no access to installment loans when they need the most. Consumers who have jobs but do not have enough cash reserve to pay unexpected expenses. Mixed methods provide structure and context to the case study of Arkansas.

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