Are Bigger Banks Better? Firm-Level Evidence from Germany

• 成果类型: Article
• 署名作者: Huber, Kilian
• 署名单位: University of Chicago
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/714120
• 发表日期: 2021
• 页码: 2023-2066
• 关键词: internal capital-markets; financial intermediation; lending relationships; COMPETITIVE DYNAMICS; INFORMATION; size; deregulation; mergers; COSTS; diversification

摘要

The effects of large banks on the real economy are theoretically ambiguous and politically controversial. I identify quasi-exogenous increases in bank size in postwar Germany. I show that firms did not grow faster after their relationship banks became bigger. In fact, opaque borrowers grew more slowly. The enlarged banks did not increase profits or efficiency but worked with riskier borrowers. Bank managers benefited through higher salaries and media attention. The results are based on newly digitized microdata on German firms and their banks. Overall, the findings reveal that bigger banks do not always raise real growth and can actually harm some borrowers and the real economy.