Application of logistic regression models to assess household financial decisions regarding debt

Abstract

Abstract The paper presents methodological assumptions regarding the logistic regression model and an example of using this research method to evaluate financial decisions taken by households. The aim of the study was to identify and evaluate socio-economic factors determining the debt of households in Central Pomerania using a logistic regression model. The source of data was the results of a survey conducted among 1,000 households of Central Pomerania (Poland). The obtained results prove that the following factors related to the socio-economic characteristics of households: economic education of the head of the household, developmental phase of the household, socio-economic type of the household had a statistically significant positive impact on the likelihood of Central Pomeranian households using external sources of financing: household income and household income. These factors increase the likelihood of households using external sources of financing. In turn, a statistically significant negative impact on the analyzed phenomenon had the household income diversification and the age of the household head.