Abstract

http://ssrn.com/abstract=2126489
 
 

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Sex and Credit: Is There a Gender Bias in Lending?


Thorsten Beck


City University London - Sir John Cass Business School; Tilburg University - European Banking Center, CentER

Patrick Behr


Brazilian School of Public and Business Administration

Andreas Madestam


Stockholm University, Department of Economics

June 4, 2013

European Banking Center Discussion Paper No. 2012-017
CentER Discussion Paper Series No. 2012-062

Abstract:     
We exploit the quasi-random assignment of borrowers to loan officers using data from a large Albanian lender to show that own-gender preferences affect both credit supply and demand. Borrowers matched to officers of the opposite sex are less likely to return for a second loan. The effect is larger when officers have little prior exposure to borrowers of the other gender and when they have more discretion to act on their gender beliefs, as proxied by financial market competition and branch size. We examine one channel of influence, loan conditionality. Borrowers assigned to opposite-sex officers pay higher interest rates and receive lower loan amounts, but do not experience higher arrears. Our results imply that own-gender preferences in the credit market can have substantial negative welfare effects.

Number of Pages in PDF File: 52

Keywords: Group identity, gender, credit supply, credit demand, loan officers

JEL Classification: G21, G32, J16

working papers series


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Date posted: August 8, 2012 ; Last revised: June 4, 2013

Suggested Citation

Beck, Thorsten and Behr, Patrick and Madestam, Andreas, Sex and Credit: Is There a Gender Bias in Lending? (June 4, 2013). European Banking Center Discussion Paper No. 2012-017. Available at SSRN: http://ssrn.com/abstract=2126489 or http://dx.doi.org/10.2139/ssrn.2126489

Contact Information

Thorsten Beck (Contact Author)
City University London - Sir John Cass Business School ( email )
106 Bunhill Row
London, EC1Y 8TZ
United Kingdom
Tilburg University - European Banking Center, CentER ( email )
PO Box 90153
Tilburg, 5000 LE
Netherlands
Patrick Behr
Brazilian School of Public and Business Administration ( email )
Praia de Botafogo 190
Rio de Janeiro, 22250-900
Brazil
Andreas Madestam
Stockholm University, Department of Economics ( email )
Stockholm, SE-106 91
Sweden
HOME PAGE: http://www.ne.su.se/andreasmadestam
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