FEAR, ANGER, AND CREDIT. ON BANK ROBBERIES AND LOAN CONDITIONS

Paola Morales‐Acevedo and Steven Ongena

Economic Inquiry, 2020, vol. 58, issue 2, 921-952

Abstract: We study the impact of emotions on real‐world decisions made by loan officers by analyzing the loan conditions of loans granted immediately after a bank branch robbery. We find significant differences between the conditions of loans granted after a robbery and changes in loan conditions that occur contemporaneously at unaffected branches. In general, loan officers seem to adopt so‐called avoidance behavior. In accordance with the literature on posttraumatic stress, their avoidance behavior is halved within 2 weeks following the robbery and the effect further varies depending on the presence, or absence, of a firearm during the robbery. (JEL G02, G2)

Date: 2020
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https://doi.org/10.1111/ecin.12826

Related works:
Working Paper: Fear, Anger and Credit. On Bank Robberies and Loan Conditions (2019)
Working Paper: Fear, Anger and Credit. On Bank Robberies and Loan Conditions (2016)
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