## Figure 2.8. Banking Crises and the Role of Household Debt

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**Canonical URL:** [Figure 2.8. Banking Crises and the Role of Household Debt](https://www.imf.org/-/media/files/publications/gfsr/2017/october/chapter-2/pdf-data/figure2-8.pdf)

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### Increase in Household and Corporate Debt Ratios around Banking Crises (Panel 1)
- Chart axis tick labels: –5, 0, 5, 10
- Variables shown: Household debt, Corporate debt
- Depiction: Average growth in ratios of household and nonfinancial corporate debt to GDP before and after a banking crisis, and the unconditional average growth rate.
- Note: Panel 1 shows the average growth in ratios of household and nonfinancial corporate debt to GDP before and after a banking crisis, as well as the unconditional average growth rate.

### Probability of a Banking Crisis: Marginal Effects (Panel 2)
- Chart axis tick labels: –4 –3 –2 –1 0 +1 +2 +3 +4 Average
- Variables shown on vertical axis with scale 0, 0.5, 1.0, 1.5, 2.0:
  - Change in corporate debt
  - Change in household debt
  - Change in household debt × high household debt level
- Estimation details:
  - Model: Panel logit model for banking crises for 34 countries
  - Controls: Country fixed effects, levels, and changes in ratios of household and nonfinancial corporate debt to GDP
  - Interaction: High household debt dummy variable set at 65 percent of GDP (representing the top quintile of the distribution)
  - Statistical significance: The effects are significant at the 10 percent confidence level
- Outcome: Panel 2 shows the marginal effects (in percentage points) of changes in corporate and household debt, and the interaction effect with high household debt, on the probability of a banking crisis.

### Data Sources and Definitions
- Sources cited: Bank for International Settlements; CEIC Data Co. Ltd.; Economic Cycle Research Institute; Haver Analytics; IMF, International Financial Statistics, and Monetary and Financial Statistics databases; Jordà-Schularick-Taylor Macrohistory Database; Laeven and Valencia 2013; Thomson Reuters Datastream; and IMF staff calculations.
- Banking crisis dates: Banking crises are taken from the updated database by Laeven and Valencia (2013).

*Figure 2.8. Banking Crises and the Role of Household Debt*

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_Source: https://www.imf.org/-/media/files/publications/gfsr/2017/october/chapter-2/pdf-data/figure2-8.pdf_