How Law Affects Lending

• 成果类型: Article
• 署名作者: Haselmann, Rainer; Pistor, Katharina; Vig, Vikrant
• 署名单位: University of London; London Business School; Columbia University; Johannes Gutenberg University of Mainz
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhp073
• 发表日期: 2010
• 页码: 549
• 关键词: dummy variables; FOREIGN ENTRY; bankruptcy; CONTRACTS; MARKETS; finance

摘要

The paper investigates the effect of legal change on the lending behavior of banks in twelve transition economies. First, we find that banks increase the supply of credit subsequent to legal change. Second, changes in collateral law matter more for increases in bank lending than do changes in bankruptcy law. We attribute this finding to the different functions of collateral and bankruptcy law. While the former enhances the likelihood that individual creditors can realize their claims against a debtor, the latter ensures an orderly process for resolving multiple, and often conflicting, claims after a debtor has become insolvent. Finally, we find that foreign-owned banks respond more strongly to legal change than incumbents. (JEL F34, F37, G21, G28, G33, K39)