Too sunny to borrow: Sunshine and borrower discouragement

Jérémie Bertrand and Laurent Weill
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Jérémie Bertrand: LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - Université de Lille - CNRS - Centre National de la Recherche Scientifique

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Abstract: We test the hypothesis that sunshine affects the discouragement of borrowing firms. Using a sample of approximately 45,000 firms from 124 countries for the period 2010–2020, we find that higher sunshine is associated with a greater probability of being discouraged for the borrowing firm. Furthermore, we establish that the discouraging impact of sunshine on the decision to apply for a loan is only observed in low latitude zones. We explain these findings by arguing that more sunshine creates a negative mood in hot regions. Additional results suggest that managerial features affect the discouraging impact of sunshine.

Date: 2023-04
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Published in Research in International Business and Finance, 2023, 65, pp.101988. ⟨10.1016/j.ribaf.2023.101988⟩

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Related works:
Journal Article: Too sunny to borrow: Sunshine and borrower discouragement (2023)
Working Paper: Too Sunny to Borrow: Sunshine and Borrower Discouragement (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04278562

DOI: 10.1016/j.ribaf.2023.101988

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