The Credit Card Use and Debt: Is there a trade-off between compulsive buying and ill-being perception?

Abstract

The differential of this paper is to consider that compulsive buying and ill-being perception constructs act in opposite dimensions on credit card use and debt. While compulsive buying leads the individual to a higher credit card usage and therefore more debt, the perception that future financial problems would cause ill-being acts as a controlling force of the credit card use and consequently of the debt. Besides the model development, this study aims to evaluate if the model is suitable for men and women. A survey was conducted with 1831 individuals of three regions of Brazil. Results support the idea that in the purchase decision-making process with credit card, two forces act in opposite directions, while the compulsive buying stimulates usage and debt, the ill-being perception discourages it. However, this trade-off is unbalanced, because the impact of compulsive buying’s coefficients is superior to the ill-being perception ones.