Contagious Effects of a Political Intervention in Debt Contracts: Evidence Using Loan-Level Data

• 成果类型: Article
• 署名作者: Tantri, Prasanna L.
• 署名单位: Indian School of Business (ISB)
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhy001
• 发表日期: 2018
• 页码: 4556
• 关键词: systemic risk; credit; access; finance

摘要

Using an unexpected government regulation that restricted the ability of microfinance institutions to recover loans in one Indian state, I examine whether this intervention affected bank loan performance. The bank loan delinquency rate significantly increased as a result. In response, the ex post bank credit supply declined by more than half. For identification, I compare loans from branches located in regions subject to this intervention with loans from nearby branches of the same bank located in regions not subject to the intervention. I conclude that political interventions in credit markets could have significant spillover effects.