Bank Discrimination in Transition Economies: Ideology, Information or Incentives?

Loren Brandt () and Hongbin Li

No 517, William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan

Abstract: We study bank discrimination against private firms in transition countries. Theoretically, we show that banks may discriminate for non-profit reasons, but this discrimination diminishes with a bank’s incentives and human capital. Employing matching bank-firm data from China, we empirically examine the extent, sources and consequences of discrimination. Our unique survey design allows us to disentangle sample truncation, omitted variable bias, and endogeneity issues. Our empirical findings confirm the theoretical predictions. We also find that as a result of discrimination, private firms resort to more expensive trade credits.

Keywords: Bank discrimination; privatization; economic transition (search for similar items in EconPapers)
JEL-codes: G14 G21 P26 P34 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2002-10-01
New Economics Papers: this item is included in nep-mfd and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
http://www.wdi.umich.edu/files/Publications/WorkingPapers/wp517.pdf
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.wdi.umich.edu/files/Publications/WorkingPapers/wp517.pdf [302 Found]--> https://wdi.umich.edu/files/Publications/WorkingPapers/wp517.pdf)

Related works:
Journal Article: Bank discrimination in transition economies: ideology, information, or incentives? (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wdi:papers:2002-517

Access Statistics for this paper

More papers in William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan 724 E. University Ave, Wyly Hall 1st Flr, Ann Arbor MI 48109. Contact information at EDIRC.
Bibliographic data for series maintained by WDI ().