References (51)


Citations (3)



Costly Information, Entry, and Credit Access

Todd A. Gormley

University of Pennsylvania - The Wharton School

September 23, 2013

Using a theoretical model that incorporates asymmetric information and differing comparative advantages among lenders, this paper analyzes the impact of lender entry on credit access. The model shows that lender entry has the potential to create a segmented market. This segmentation increases credit access for those firms targeted by the new lenders but potentially reduces credit access for all other firms. The overall impact on net output depends on the distribution of firms, the relative costs of lenders, and the cost of acquiring information. The model provides new insights into the evidence regarding foreign lenders’ entry into emerging markets.

Number of Pages in PDF File: 45

Keywords: Asymmetric Information, Competition, Credit, Financial Liberalization

JEL Classification: D82, F3, G2, O16, O19

working papers series

Download This Paper

Date posted: April 18, 2006 ; Last revised: September 23, 2013

Suggested Citation

Gormley, Todd A., Costly Information, Entry, and Credit Access (September 23, 2013). Available at SSRN: http://ssrn.com/abstract=896000 or http://dx.doi.org/10.2139/ssrn.896000

Contact Information

Todd A. Gormley (Contact Author)
University of Pennsylvania - The Wharton School ( email )
The Wharton School
3620 Locust Walk
Philadelphia, PA 19104
United States
(314) 313-4330 (Phone)
HOME PAGE: http://apps.olin.wustl.edu/faculty/Gormley/

Feedback to SSRN

Paper statistics
Abstract Views: 2,000
Downloads: 497
Download Rank: 29,256
References:  51
Citations:  3
Paper comments
No comments have been made on this paper

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo3 in 0.531 seconds