Market size structure and small business lending: Are crisis times different from normal times?
Berger,Allen N. Cerqueiro,G.M. Penas,Maria
Berger,Allen N.
Cerqueiro,G.M.
Penas,Maria
Abstract
Conventional wisdom holds that small banks have comparative advantages vis-à-vis large banks in serving small firms, while recent literature suggests this may not be the case. Using a panel of recent US start-ups, we investigate how small bank presence affects these firms in normal times (2004–06) and in the recent financial crisis (2007–09). We find that greater small bank presence yields significantly more lending to and slightly lower failure rates of these firms during normal times. However, these benefits disappear during the financial crisis, possibly because small banks are less diversified and benefit less from government guarantees than large banks.
Description
Date
2015-10
Journal Title
Journal ISSN
Volume Title
Publisher
Research Projects
Organizational Units
Journal Issue
Keywords
G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages, G28 - Government Policy and Regulation, L11 - Production, Pricing, and Market Structure ; Size Distribution of Firms, SDG 8 - Decent Work and Economic Growth, SDG 9 - Industry, Innovation, and Infrastructure, SDG 10 - Reduced Inequalities
Citation
Berger, A N, Cerqueiro, G M & Penas, M 2015, 'Market size structure and small business lending : Are crisis times different from normal times?', Review of Finance, vol. 19, no. 5, pp. 1965-1995. https://doi.org/10.1093/rof/rfu042
License
info:eu-repo/semantics/closedAccess