Making sense of soft information: interpretation bias and loan quality

• 成果类型: Article
• 署名作者: Campbell, Dennis; Loumioti, Maria; Wittenberg-Moerman, Regina
• 署名单位: Harvard University; University of Texas System; University of Texas Dallas; University of Southern California
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2019.101240
• 发表日期: 2019
• 关键词: LENDING RELATIONSHIPS; performance-measures; decision-making; BANK; OFFICERS; GENDER; distance; matter; me; SUBJECTIVITY

摘要

We explore whether cognitive constraints and behavioral biases impede the processing and interpretation of soft information in private lending. Using data from a credit union's internal reporting system, we delineate three constraints and biases likely to affect lending decisions: limited attention, task-specific human capital and common identity. We find that soft information leads to worse loan quality when loan officers are busy or before weekends and around national holidays; when they have prior sales experience; and when both the officers and borrowers are men. We provide evidence of non-agency-related costs in the use of soft information in lending decisions. (C) 2019 Elsevier B.V. All rights reserved.