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A country's payment system is what makes its real and financial markets work. When commodities are exchanged for cash, check, giro, credit card, or debit card payments-rather than for other [...]

Robert B. Avery [*] Raphael W. Bostic [**] Paul S. Calem [**] Glenn B. Canner [**] Although credit scoring offers benefits to lenders and borrowers, its use raises important statistical [...]

The widespread use of credit scoring in the underwriting and pricing of mortgage and consumer credit has raised concerns that the use of these scores may unfairly disadvantage minority populations. A specific concern has been that the independent variables that comprise these models may have a disparate impact on these demographic groups. By 'disparate impact' we mean that a variable's predictive power might arise not from its ability to predict future performance within any demographic group, but rather from acting as a surrogate for group membership. Using a unique source of data that combines a nationally representative sample of credit bureau records with demographic information from the Social Security Administration and a demographic information company, we examine the extent to which credit history scores may have such a disparate impact. Our examination yields no evidence of disparate impact by race (or ethnicity) or gender. However, we do find evidence of some limited disparate impact by age, in which the use of variables related to an individual's length of credit history appear to lower the credit scores of older individuals and increase them for the young. [ABSTRACT FROM AUTHOR]

Data made available annually pursuant to the Home Mortgage Disclosure Act of 1975 (HMDA) provide an opportunity to explore changes in mortgage market activity along a host of dimensions.1 HMDA requiresmost mortgage lending institutions with offices in metropolitan areas to publicly disclose information about their home-lending activity each year. The data include the disposition of each application for mortgage credit; the type, purpose, lien status, and characteristics of the home mortgages.

A number of researchers have recently questioned whether the Community Reinvestment Act (CRA) is still needed. In addition, economic analysis has explored the efficiency of many regulations, but not the CRA. This article seeks to address both issues to shed light on the necessity and efficiency of the CRA. On the basis of data from a survey on the performance and profitability of CRA-related lending activities, we reach three main conclusions. First, consistent with the view that the CRA is needed, we find evidence that the majority of surveyed institutions engaged in some lending activities that they would not otherwise have done in the absence of the law. Second, in terms of efficiency, the results are mixed: The vast majority of institutions increased credit flows profitably, but a significant minority incurred costs, albeit small ones. Third, quantitative evidence suggests that marginal CRA-related lending tended to be small. [ABSTRACT FROM AUTHOR]

Reports on the role of information that credit-reporting agencies maintain on consumers' credit-related experiences in credit markets in the U.S. Effects of data limitations on consumers' access to credit; Concern among financial analysts about the accuracy, completeness, timeliness and consistency of consumer credit records; Elements of credit models used to generate credit history scores.

Focuses on the special leading programs of the Community Reinvestment Act (CRA) in the United States. Implications of the CRA programs for banking institutions; Impact of the CRA on low-income populations; Characteristics of the special lending programs; Profitability of the programs in comparison with the overall mortgage lending.

Explores the relationship between consolidation and lending to purchase homes. Trends in banking consolidation; Consolidation and market-level changes in mortgage lending; Consolidation and mortgage lending at the banking organization level.

In this paper the authors present evidence on household saving in the U.S. based on the panel data from the 1983 and 1986 waves of the Survey of Consumer Finances. Saving is measured in these surveys as the change in wealth over the three-year period. Using a variety of models, we are able to explain only about 7 percent of the variation in the level of saving. Demographic factors appear to be modestly useful in explaining saving. However, one her is very clear from the patterns of correlation extracted so far; either the measurement error in the data is quite large, or idiosyncratic factors are very important in explaining saving behavior, or both. [ABSTRACT FROM AUTHOR]

Because wealth estimates from survey data have usually fallen substantially short of independent aggregate estimates, survey data have not been seen as adequate for assessing questions dependent on a good representation of the entire distribution of wealth, such as estimates of wealth concentration. The 1983 Survey of Consumer Finances (SCF), which contains a supplementary sample of very high income households drawn from a tax-file sample frame, is the first U.S. survey since the 1963 Survey of Financial Characteristics of Consumers that offers hope of accurately measuring the entire wealth distribution. In this paper, we discuss the design of the survey, the critical issue of proper weighting to merge the supplementary sample with an area probability sample, and the role of imputation. We show that the use of ordinary area probability samples alone leads to probable bias in the measurement of highly concentrated assets such as stocks and bonds. We compare the SCF data with aggregates derived from the flow-of-funds accounts of the Federal Reserve Board. While methodological issues cloud exact comparisons, it appears overall that the SCF estimates are at least as credible as other aggregate measurements. Finally, we use the data to assess the change in concentration of wealth from 1963 to 1983. We estimate that the concentration of wealth in terms of households did not change significantly over this period. [ABSTRACT FROM AUTHOR]

If the research goal in applying classical discriminant analysis techniques is to test for differences in the general characteristics of groups, then standard tests from multivariate analysis of variance are appropriate. Statistically significant differences among group means and dispersions indicate that the groups arose from separate populations. If, however, the goal is to explore group structure in terms of group overlap and the locations of individual observations relative to each other and to the group means, then it can be shown that the significance tests provide incomplete and often misleading representations of the data. Similarly, in problems involving just more that just two groups, the null hypothesis can be rejected, when in fact only one of the several groups arose from a different population.

Angiolymphoid hyperplasia with eosinophilia (ALHE) is an uncommon, benign disorder that presents as solitary or multiple nodules in the dermis or subcutaneous tissue. Orbital ALHE has been reported on occasion. We report a case of orbital ALHE which was refractory to systemic steroids but effectively treated with low-dose subcutaneous methotrexate. To our knowledge, this is the first reported case of methotrexate as a successful treatment for refractory ALHE. [ABSTRACT FROM AUTHOR]