Do Laws Change Minds? Evidence From Same-Sex Marriage Laws and Lending Practices to Sexual Minorities
Posted: 23 Aug 2019
Date Written: August 20, 2019
We exploit the staggered adoption of same-sex marriage (SSM) legalization to examine its effect on lending practices toward same-sex borrowers. We use loan-level data from the Home Mortgage Disclosure Act between 2004-2018, a period that spans the entire rollout of SSM legalization across the United States. We find that following SSM legalization, the probability that same-sex mortgage applicants are denied credit increases compared to otherwise similar different-sex applicants. This backlash is concentrated among states in which SSM legalization is imposed by state or federal courts rather than by public votes or state legislatures. Our results present a contrasting view to a recent literature that documents a positive influence of SSM legalization on the social attitudes towards same-sex couples.
Keywords: banks, mortgages, same-sex marriage, sexual orientation, LGBT
JEL Classification: G21, K36
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