THE EFFECTS OF USURY LAWS: EVIDENCE FROM THE ONLINE LOAN MARKET

• 成果类型: Article
• 署名作者: Rigbi, Oren
• 署名单位: Ben-Gurion University of the Negev
• 刊物名称: REVIEW OF ECONOMICS AND STATISTICS
• ISSN/ISSBN: 0034-6535
• DOI: 10.1162/REST_a_00310
• 发表日期: 2013-10
• 页码: 1238-1248
• 关键词: rate ceilings; credit; IMPACT

摘要

Usury laws cap the interest rates that lenders can charge. Using data from Prosper.com, an online lending marketplace, I investigate the effects of these laws. The key to my empirical strategy is that there was initially substantial variability in states' interest rate caps, ranging from 6% to 36%. A behind-the-scenes change in loan origination, however, suddenly increased the cap to 36%. The main findings of the study are that higher interest rate caps increase the probability that a loan will be funded, especially if the borrower was previously just outside the money. I do not find, however, changes in loan amounts and default probability. The interest rate paid rises slightly, probably because online lending is substantially, yet imperfectly, integrated with the general credit market.