Individual Mortgage Lending, Public Corruption, Race and Gender: Evidence from Local Corruption Crack-Downs

46 Pages Posted: 13 Aug 2021

See all articles by Albert Mensah

Albert Mensah

HEC Paris - Accounting and Management Control Department

Arthur Morris

Hong Kong University of Science & Technology (HKUST) - Department of Accounting

Han Stice

The Chinese University of Hong Kong

Roger M. White

Arizona State University (ASU) - School of Accountancy

Date Written: July 16, 2021

Abstract

We examine how corruption influences the mortgage market. Prior research documents that corruption is most costly in cases, like home buying, where government interaction is frequent and necessary. Accordingly, after anti-corruption laws pass bank-offices both accept more mortgage applications, and offer more favorable terms (without changing future delinquency). These laws are passed largely by cities and counties, so we implement a fixed-effects structure such that our results are driven by lending decisions at the same bank office for mortgage applications across jurisdictions. We also find that the effect of these laws varies by self-reported race and gender.

Suggested Citation

Mensah, Albert and Morris, Arthur and Stice, Han and White, Roger M., Individual Mortgage Lending, Public Corruption, Race and Gender: Evidence from Local Corruption Crack-Downs (July 16, 2021). Available at SSRN: https://ssrn.com/abstract=3888069 or http://dx.doi.org/10.2139/ssrn.3888069

Albert Mensah

HEC Paris - Accounting and Management Control Department

Jouy-en-Josas
France

HOME PAGE: http://https://www.hec.edu/en/faculty-research/faculty-directory/faculty-member/mensah-albert

Arthur Morris (Contact Author)

Hong Kong University of Science & Technology (HKUST) - Department of Accounting ( email )

Clear Water Bay
Kowloon
Hong Kong

Han Stice

The Chinese University of Hong Kong ( email )

Shatin, N.T.
Hong Kong

Roger M. White

Arizona State University (ASU) - School of Accountancy ( email )

Tempe, AZ 85287
United States

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