Does Marriage Equality Promote Credit Access? Evidence from Same-sex Marriage Laws

58 Pages Posted: 23 Aug 2019 Last revised: 18 Mar 2023

See all articles by Jens Hagendorff

Jens Hagendorff

King’s College London - King's Business School

Duc Duy Nguyen

Durham University

Vathunyoo Sila

University of Edinburgh

Date Written: October 24, 2022

Abstract

We show that following the legalization of same-sex marriage across US states, mortgage applications from same-sex borrowers are more likely to be denied relative to a matched sample of different-sex borrowers. Our findings are robust to using a stacked regression design and several approaches to account for compositional changes in the pool of mortgage applicants around same-sex legalization. FinTech lenders, which rely less on human loan officers, experience no change in the denial gap. Our results highlight information frictions between loan officers and same-sex borrowers as one channel for the increased denial gap between same-sex and different-sex applications.

Keywords: banks, mortgages, same-sex marriage

JEL Classification: G21, J12, J15, K36

Suggested Citation

Hagendorff, Jens and Nguyen, Duc Duy and Sila, Vathunyoo, Does Marriage Equality Promote Credit Access? Evidence from Same-sex Marriage Laws (October 24, 2022). Journal of Corporate Finance, Vol. 77, Article 102315, 2022, Available at SSRN: https://ssrn.com/abstract=3440605 or http://dx.doi.org/10.2139/ssrn.3440605

Jens Hagendorff (Contact Author)

King’s College London - King's Business School

30 Aldwych
London, WC2B 4BG
United Kingdom

Duc Duy Nguyen

Durham University ( email )

Mill Hill Lane
Durham, Durham DH1 3HP
United Kingdom

HOME PAGE: http://sites.google.com/site/louisnguyen6589/home

Vathunyoo Sila

University of Edinburgh ( email )

29 Buccleuch Place
Edinburgh, Scotland EH8 9JS
United Kingdom
+447428747109 (Phone)

HOME PAGE: http://https://www.business-school.ed.ac.uk/staff/ben-sila

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