Numeracy and On‐The‐Job Performance: Evidence from Loan Officers

25 Pages Posted: 14 May 2020

See all articles by Martin Brown

Martin Brown

University of St. Gallen

Karolin Kirschenmann

ZEW – Leibniz Centre for European Economic Research

Thomas Spycher

University of St. Gallen - School of Finance

Date Written: April 2020

Abstract

We examine how the numeracy level of employees influences their on‐the‐job performance. Based on an administrative dataset of a retail bank we relate the performance of loan officers in a standardized math test to the accuracy of their credit assessments of small business borrowers. We find that loan officers with a high level of numeracy are more accurate in assessing the credit risk of borrowers. The effect is most pronounced during the precrisis credit boom period when it is arguably more difficult to pick out risky borrowers.

JEL Classification: G21, J24

Suggested Citation

Brown, Martin and Kirschenmann, Karolin and Spycher, Thomas, Numeracy and On‐The‐Job Performance: Evidence from Loan Officers (April 2020). Economic Inquiry, Vol. 58, Issue 2, pp. 998-1022, 2020, Available at SSRN: https://ssrn.com/abstract=3597053 or http://dx.doi.org/10.1111/ecin.12873

Martin Brown (Contact Author)

University of St. Gallen ( email )

Unterer Graben 21
St. Gallen, CH-9000
Switzerland

Karolin Kirschenmann

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 71
D-68034 Mannheim, 68034
Germany

Thomas Spycher

University of St. Gallen - School of Finance ( email )

Unterer Graben 21
St.Gallen, CH-9000
Switzerland

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
0
Abstract Views
55
PlumX Metrics