Learning from a rival bank and lending boom

研究成果: Article

21 引用 (Scopus)

抜粋

When bankers observe a rival winning in the interbank competition for lending to a firm, they infer that the firm may be more promising than they had thought. From this consideration, they loosen their creditworthiness tests and lower the interest rates they offer in the next lending competition for the firm. Increased interbank competition reduces the impact of this observational learning and decreases the credit risk taken by each bank because of a severe winner's curse, while it increases the aggregate risk taken by the entire banking sector.

元の言語English
ページ(範囲)535-555
ページ数21
ジャーナルJournal of Financial Intermediation
15
発行部数4
DOI
出版物ステータスPublished - 2006 10 1

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ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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