A new study released by Dartmouth College Prof. Jonathan Zinman last week examined the effect of a ban on payday loans on Oregon households. Similar to the 2007 report, Payday Holiday, by the New York Federal Reserve, this study confirms that households in states with a payday lending ban fare worse than where payday loans are allowable.

The study states that borrowers have no choice but to choose “inferior substitutes” in the absence of payday loans, and that “restricting access (to payday loan credit) caused deterioration in the overall financial condition of the Oregon households.”