Abstract

http://ssrn.com/abstract=308908
 
 

References (81)



 
 

Citations (164)



 


 



Small Business Credit Availability and Relationship Lending: The Importance of Bank Organisational Structure


Allen N. Berger


University of South Carolina - Moore School of Business; Wharton Financial Institutions Center; Tilburg University - CentER

Gregory F. Udell


Indiana University - Department of Finance


The Economic Journal, Vol. 112, pp. F32-F53, 2002

Abstract:     
This paper models the inner workings of relationship lending, the implications for bank organisational structure, and the effects of shocks to the economic environment on the availability of relationship credit to small businesses. Relationship lending depends on the accumulation over time by the loan officer of 'soft' information. Because the loan officer is the repository of this soft information, agency problems are created throughout the organisation that may best be resolved by structuring the bank as a small, closely-held organisation with few managerial layers. The shocks analysed include technological innovations, regulatory regime shifts, banking industry consolidation, and monetary policy shocks.

Number of Pages in PDF File: 22

Accepted Paper Series


Date posted: November 7, 2002  

Suggested Citation

Berger, Allen N. and Udell, Gregory F., Small Business Credit Availability and Relationship Lending: The Importance of Bank Organisational Structure. The Economic Journal, Vol. 112, pp. F32-F53, 2002. Available at SSRN: http://ssrn.com/abstract=308908

Contact Information

Allen N. Berger (Contact Author)
University of South Carolina - Moore School of Business ( email )
1705 College St
Francis M. Hipp Building
Columbia, SC 29208
United States
803-576-8440 (Phone)
803-777-6876 (Fax)
Wharton Financial Institutions Center
Philadelphia, PA 19104-6367
United States
Tilburg University - CentER
P.O. Box 90153
Tilburg, DC 5000 LE
Netherlands
Gregory F. Udell
Indiana University - Department of Finance ( email )
1309 E. 10th St.
Bloomington, IN 47405
United States
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