Association for Public Policy Analysis & Management

We evaluate the effect that payday loan access has on credit and labor market outcomes of individuals in the U.S. Army.  Using the conditional random assignment of servicemembers to different locations, we employ three identification strategies: cross-sectional variation in state policies, within-term variation in payday lending access over time, and a difference-in-difference analysis using the national Military Lending Act.  We find few adverse effects of payday loan access on servicemembers when using any of these methods even when we examine dozens of subsamples that explore potential differential treatment effects