They exhibit the profile characteristic of being credit constrained with spending out of current income, while simultaneously choosing a “flat” profile for credit card spending over the pay period. This behavior suggests of the use of a mental account rule, and thus provides some indication that households in our sample are sophisticated, and able to use internal commitments to limit overspending. In summary, the two main stylized facts generated by this paper are difficult to explain in the standard economic framework. The self-control problem framework, by contrast, offers a relatively parsimonious and unified explanation. In this sense, our findings provide support for the view that self-control problems are.
