Impact of Great Recession Bank Failures

Focused on the Use of Financial Services Among Racial/Ethnic and Income Groups

This event is hosted by the Pepperdine School of Public Policy's Diversity Committee and in observance of the official National Financial Capability Month. In April organizations around the country raise awareness about the importance of financial literacy and the need for effective financial education. This seminar will bring attention to racial/ethnic disparities in relation to the use of financial services in the United States.

Using individual-level data from the 2013, 2015, and 2017 Unbanked and Underbanked Household surveys, Dr. Contreras and co-authors examine the effect of the magnitude of bank failures in the 2008-2011 period on individuals' use of financial services. Study shows that the intensity of bank failure reduces the probability of owning a bank account and increases the probability of being unbanked. Such adverse effects are most pronounced on minorities, specifically on middle and high-income blacks and Hispanics. High-income blacks and Hispanics are 4.5 and 3.1 percentage points more likely to be underbanked relative to low-income individuals. In addition, middle and high-income Hispanics are 2.6 and 4.7 percentage points less likely to be fully banked. These effects on individuals' personal finance choices underscore the need for policy actions to forestall bank failures.

Zoom details will be provided in your email confirmation following registration.
SPP Students can receive one professional development credit for this event.

Presenter

Dr. Salvador Contreras is an associate professor of economics and director of the Center for Border Economic Studies at the University of Texas Rio Grande Valley. Salvador's research explores linkages between financial intermediation and societal impacts such as entrepreneurship, income mobility, financial inclusion, and household decisions. In addition, he writes reports on topics related to US-Mexico trade, Texas, and Texas border region.

Moderator

Dr. Luisa Blanco is a Professor of Economics at Pepperdine University School of Public Policy. She specializes in development and international economics, with a focus on Latin America. Her research interests pertain to the wellbeing of Latin Americans at home and abroad. Blanco is a fellow for the Robert Wood Johnson Interdisciplinary Research Leadership Program, board member at UCLA Resource Center for Minority Aging Research-Center for Health Improvement of Minority Elderly (RCMAR-CHIME). Blanco's current work is in the area of consumer and household finance, with a focus on minorities in the United States.