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The Effect of Banking Regulation on Cross-Border Lending

Projektbeschreibung:
Regulation may oblige banks to document their evaluation of firms’ creditworthiness for a supervisory authority. Consequently, banks cannot use private information but need to collect verifiable information. Thus, bank regulation influences the choice of the lending technology. We show in a theoretical model that differences in regulation increase competition between domestic and foreign banks. Strict domestic regulation results in cross-border lending by competing foreign banks. We predict that lending rates are lower and access to credit is easier for firms located closer to the border. These predictions are confirmed in the empirical analysis using unique bank- and firm-level data from Germany
Projektlaufzeit:
Projektbeginn: 01.05.2011
Projektende: 31.12.2013
Projektleitung:
Prof. Dr. Jarko Fidrmuc, Dr. Christa Hainz

Zeppelin University Friedrichshafen
Zeppelin-Lehrstuhl für Internationale Wirtschaftstheorie & -politik (eingerichtet 05 / 2011)

Am Seemooser Horn 20
88045 Friedrichshafen

Telefon: +49 7541 6009-1241
Fax: +49 7541 6009-1299
Email: jarko.fidrmuc@zu.de
http://www.zeppelin-university.de/deutsch/lehrstuehle/internationales_management/internationales_management_profil.php
Finanzierung:

  • eigenfinanziertes Forschungsprojekt

Projektbezogene Publikationen:

  • Fidrmuc, Jarko, Hainz, Christa: Financial Integration and Banking Regulation: Cross-Border Lending in Germany, Journal of Banking and Finance, 2013; Jg. 37 (5): 1310-1322.

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