Sharing Default Information as a Borrower Discipline Device

A.J. Padilla and Marco Pagano

Working Papers from Boston University - Industry Studies Programme

Abstract: Creditors often share information about their customers' credit record. Besides helping them to spot bad risks, this informational exchange acts as a disciplinary device. If creditors are known to exchange data about defaults, borrowers must consider that default on a current lender would disrupt their credit rating with all the other lenders. This raises their incentive to perform.

Keywords: INFORMATION; FINANCIAL MARKET (search for similar items in EconPapers)
JEL-codes: D80 D82 G20 G21 (search for similar items in EconPapers)
Pages: 26 pages
Date: 1996
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Sharing default information as a borrower discipline device (2000)
Working Paper: Sharing Default Information as a Borrower Discipline Device (1999)
Working Paper: Sharing Default Information as a Borrower Discipline Device (1999)
Working Paper: Sharing Default Information as a Borrower Discipline Device (1999)
Working Paper: Sharing Default Information as a Borrower Discipline Device (1996)
Working Paper: Sharing Default Information as a Borrower Discipline Device (1994)
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