Is bank lending corruption self-regulatory?
Journal of Economic and Financial Studies (JEFS), 2017, vol. 5, issue 3, 31-34
This article puts forward the possibility that bank-client corruption tends to raise lending rates. If it does and if bank-official corruption counteracts this tendency, bank lending corruption might be seen as a self-regulatory phenomenon, having little if none at all influence on the real economy. An anti-lending corruption policy is deemed to be necessary only under a zero-lower-bound associated monetary policy and in any case, it should treat the two types of banking-sector corruption symmetrically. The negative effects of bank sector fraud on economic growth should be related to the large volume of cybercrime and money laundering rather than to fraud surrounding bank lending. Classification JEL: D21; D73; E43
Keywords: Bank lending corruption; Bank non-lending fraud; Economic activity. (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:lrc:lareco:v:5:y:2017:i:3:p:31-34
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