Is there help indeed, if there is help in need? The case of credit unions during the global financial crisis

Leila Aghabarari, Andre Guettler, Mahvish Naeem and Bernardus Van Doornik

Economic Inquiry, 2021, vol. 59, issue 3, 1215-1233

Abstract: Credit unions (CUs) may respond to a financial shock differently than other types of banks because of their unique membership‐based governance structure. We exploit the financial crisis of 2008/09 as a negative shock to Brazilian banks and analyze the lending behavior of CUs in comparison to non‐CUs and the subsequent effects on the commercial clients' labor force. We find that during the financial crisis, CUs tightened their members' access to credit to a lesser extent (insurance effect) than did other bank types. Notably, the labor market impact of the insurance effect of CUs is positive for very small firms.

Date: 2021
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https://doi.org/10.1111/ecin.12982

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Working Paper: Is There Help Indeed, if There is Help in Need? The case of credit unions during the global financial crisis (2020)
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