Debt attitudes and debt accumulation among rural poor households in a developing region: insights from Kerala, India

Integrating both quantitative and qualitative data, this paper contributes to the literature on attitude-behaviour relationship by examining the influence of debt attitudes on the debt behaviours of rural poor households in Kerala, India. Data suggests that debt attitudes within this demographic can be better characterised as general and circumstantial attitudes. Surveying 720 households, the quantitative analysis reveals a significant association between the general debt attitudes of the household’s primary financial decision-maker and the likelihood of the household having an outstanding loan. However, debt attitudes do not predict the total amount of household debt. Analysing 21 interviews, three explanations for this attitude-behaviour disconnect emerged: the inescapable inevitability of borrowing, the dynamic nature of debt attitudes, and debt recycling practices. The paper argues that individualistic/dispositional factors alone cannot address excessive indebtedness without addressing underlying socioeconomic disadvantages. It calls for comprehensive policy reforms targeting the root structural causes of financial vulnerability.