Gender Differences in Type 1 Credit Rationing of Small Businesses in the US

Cogent Economics & Finance Vol. 3, Iss. 1, 2015, doi.org/10.1080/23322039.2015.1021553

Posted: 28 Dec 2014 Last revised: 21 Mar 2015

See all articles by Naranchimeg Mijid

Naranchimeg Mijid

Connecticut Center for Innovative Entrepreneurs

Date Written: February 3, 2014

Abstract

This paper explores Type 1 credit rationing by gender using data from Survey of Small Business Finances. Type 1 credit rationing occurs when borrowers receive a smaller loan than they requested. We use two measures of Type 1 credit rationing to examine whether it is related to gender discrimination in lending. Our results show that women business owners are not likely to be Type 1 rationed. However, newer female-owned firms receive significantly lower loan amounts than requested compared to their male-owned counterparts. We also find that less experienced women receive significantly lower loan amounts compared to less experienced men.

Keywords: Small Business Finances, Women Entrepreneurs, Female-owned Businesses, Gender Discrimination

JEL Classification: J16, L26, D21

Suggested Citation

Mijid, Naranchimeg, Gender Differences in Type 1 Credit Rationing of Small Businesses in the US (February 3, 2014). Cogent Economics & Finance Vol. 3, Iss. 1, 2015, doi.org/10.1080/23322039.2015.1021553 , Available at SSRN: https://ssrn.com/abstract=2515010

Naranchimeg Mijid (Contact Author)

Connecticut Center for Innovative Entrepreneurs ( email )

185 Main St. Suite 403
New Britain, CT 06051
United States
860-328-2954 (Phone)

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