Lending to Small and Medium-Sized Firms: Is There an East-West Gap in Germany?

Posted: 24 Nov 2009  

Erik E. Lehmann

University of Augsburg - Faculty of Business and Economics

Solvig Rathke

affiliation not provided to SSRN

Doris Neuberger

University of Rostock - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: 2004

Abstract

The financing of small and medium-sized firms is important for the catching-up of the East German to the West German economy since reunification. We explore whether it is restricted by unfavorable bank loan terms, using bank-survey data on lending decisions to small and medium- sized firms. A comparison of the terms of lending between the former East German and West German states yields a lending gap given by higher loan prices and collateral requirements in East Germany. This gap can be explained by differences in credit risks and lending strategies of banks. (Publication abstract.)

Keywords: Credit risks, Statistical data, Risk assessment, Bank loans, Economic growth, Lending policies, Interest (finance), Regional economies, Credit discrimination, Collateral, Financing

Suggested Citation

Lehmann, Erik E. and Rathke, Solvig and Neuberger, Doris, Lending to Small and Medium-Sized Firms: Is There an East-West Gap in Germany? (2004). Small Business Economics, Vol. 23, Issue 1, p. 23-39 2004. Available at SSRN: https://ssrn.com/abstract=1511062

Erik E. Lehmann (Contact Author)

University of Augsburg - Faculty of Business and Economics ( email )

Universitätsstr. 16
Augsburg, 86135
Germany

Solvig Rathke

affiliation not provided to SSRN

No Address Available

Doris Neuberger

University of Rostock - Department of Economics ( email )

Ulmenstr. 69
Rostock, 18057
Germany
+49 381 498 4346 (Phone)
+49 381 498 4341 (Fax)

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