Journal ArticleDOI
Big Banks, Household Credit Access, and Intergenerational Economic Mobility
Reads0
Chats0
TLDR
The authors found that low income households face reduced access to credit when local banks are large, which may stem from large banks' comparative disadvantage using soft information, which is particularly important for lending to low-income households.Abstract:
Consolidation in the United States banking industry has led to larger banks. I find that low income households face reduced access to credit when local banks are large. This result appears to stem from large banks’ comparative disadvantage using soft information, which is particularly important for lending to low income households. In contrast, the size of local banks has little or no effect on high income households. Consistent with low income parents’ credit constraints limiting investment in their children’s human capital, areas with larger banks exhibit a greater sensitivity of educational attainment to parental income, and less intergenerational economic mobility.read more
Citations
More filters
Journal ArticleDOI
Racial Discrimination in the Auto Loan Market
TL;DR: This paper found that Black and Hispanic applicants' loan approval rates are 1.5 percentage points lower than white applicants, even controlling for creditworthiness, consistent with racial bias rather than statistical discrimination.
Journal ArticleDOI
Racial Disparities in the Auto Loan Market
TL;DR: The authors found that Black and Hispanic applicants' approval rates are 1.5 percentage points lower than white applicants, even after controlling for creditworthiness, and that this effect crowds out 80,000 minority loans each year.
ReportDOI
The Impact of Minority Representation at Mortgage Lenders
TL;DR: This paper found that minority borrowers are significantly underrepresented among loan officers and are less likely to complete mortgage applications, have completed applications approved, and to ultimately take-up a loan when working with minority loan officers.
Journal ArticleDOI
Financial Institution Objectives & Auto Loan Pricing: Evidence from the Survey of Consumer Finances
TL;DR: In this paper, the authors improved on these studies by using household and loan-level data from the Federal Reserve's Survey of Consumer Finances from 2001 to 2019 and found that on average, households that receive auto loans from credit unions pay 0.70 percentage points less on interest rates for new vehicles and 1.40 percentage points on used vehicles.
References
More filters
Posted ContentDOI
Credit Rationing in Markets with Imperfect Information.
Joseph E. Stiglitz,Andrew Weiss +1 more
TL;DR: In this paper, a model is developed to provide the first theoretical justification for true credit rationing in a loan market, where the amount of the loan and amount of collateral demanded affect the behavior and distribution of borrowers, and interest rates serve as screening devices for evaluating risk.
Journal ArticleDOI
Financial Intermediation and Delegated Monitoring
TL;DR: In this paper, the authors developed a theory of financial intermediation based on minimizing the cost of monitoring information which is useful for resolving incentive problems between borrowers and lenders, and presented a characterization of the costs of providing incentives for delegated monitoring by a financial intermediary.
Journal ArticleDOI
An Equilibrium Theory of the Distribution of Income and Intergenerational Mobility
Gary S. Becker,Nigel Tomes +1 more
TL;DR: The theory of inequality and intergenerational mobility presented in this paper assumes that each family maximizes a utility function spanning several generations, which depends on the consumption of parents and on the quantity and quality of their children.
Journal ArticleDOI
Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States*
TL;DR: In this article, the authors use administrative records on the incomes of more than 40 million children and their parents to describe three features of intergenerational mobility in the United States: the joint distribution of parent and child income at the national level, the conditional expectation of child income given parent income, and the factors correlated with upward mobility.
Journal ArticleDOI
Small Business Credit Availability and Relationship Lending: The Importance of Bank Organisational Structure
Allen N. Berger,Gregory F. Udell +1 more
TL;DR: In this paper, the inner workings of relationship lending, the implications for bank organisational structure, and the effects of shocks to the economic environment on the availability of relationship credit to small businesses are modeled.