Credit Rationing and Credit View: Empirical Evidence from Loan Data

32 Pages Posted: 15 Jul 2009

See all articles by Leonardo Becchetti

Leonardo Becchetti

University of Rome Tor Vergata - Faculty of Economics

Maria Melody Garcia

University of Rome II - Faculty of Economics

Giovanni Trovato

University of Rome Tor Vergata - Faculty of Economics

Date Written: February 2009

Abstract

The empirical literature tries to identify credit rationing and its determinants by using balance sheet data or evidence from corporate surveys. Observational equivalence, identification problems, and interview biases are serious problems in these studies. We analyse the determinants of credit rationing directly on credit files by looking at the difference between the amount demanded and supplied to each borrower from official bank records. Our findings provide microeconomic evidence in support of the credit view hypothesis showing that the European Central Bank refinancing rate is significantly and positively related to partial (but not total) credit rationing. This finding is consistent with the hypothesis that such variable affects the total volume of commercial bank loans.

Keywords: credit rationing, credit view, loan data

JEL Classification: E51, G21

Suggested Citation

Becchetti, Leonardo and Garcia, Maria Melody and Trovato, Giovanni, Credit Rationing and Credit View: Empirical Evidence from Loan Data (February 2009). CEIS Working Paper No. 144, Available at SSRN: https://ssrn.com/abstract=1434509 or http://dx.doi.org/10.2139/ssrn.1434509

Leonardo Becchetti (Contact Author)

University of Rome Tor Vergata - Faculty of Economics ( email )

Via Columbia, 2
I-00133 Rome
Italy

Maria Melody Garcia

University of Rome II - Faculty of Economics ( email )

Via Columbia 2
Rome, 00133
Italy

Giovanni Trovato

University of Rome Tor Vergata - Faculty of Economics ( email )

Via Columbia n.2
Rome, rome 00100
Italy

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