Artículos relacionados a On the Foundations of Credit Rationing

On the Foundations of Credit Rationing - Tapa blanda

Krebs, Helena Maria

 
9783658444877: On the Foundations of Credit Rationing
Tapa blanda
ISBN 10: 3658444878 ISBN 13: 9783658444877
Editorial: Springer Gabler, 2024

Sinopsis

Helena Maria Krebs analyzes equilibrium credit rationing when banks compete for loans and deposits in a double-sided Bertrand game. Borrowers and lenders are allowed to switch market sides. Thus, investors do not only base their decisions on loan rates, but also on opportunity costs in the form of deposit rates. Credit rationing may occur if adverse selection due to borrowers’ informational advantage leads to a lower expected return on loans if the loan rate increases. In that case, banks may have an incentive to offer loan rates below the market-clearing rate. At these rates loan demand exceeds loan supply. The author reveals the important role of bank equity and its distribution: Banks with high equity offer cheap loans and reject superfluous loan applicants, whom banks with low equity then offer expensive loans. Thereby expensive banks realize a higher expected return on loans thancheap banks. Furthermore, this book is the first to formally model the process of acceptance and rejection of loan applicants as a separate stage of the double-sided Bertrand game after banks have decided on their interest rates. It is shown that for fixed chosen interest rates, the deposit and loan volumes of all banks in a subgame perfect Nash equilibrium of the resource allocation game are uniquely determined.

"Sinopsis" puede pertenecer a otra edición de este libro.

Acerca del autor

Helena Maria Krebs received her PhD from the University of Kaiserslautern-Landau working at the intersection of economic theory and economics of banking. Now she is a postdoctoral scholar at the Catholic University of Eichstätt-Ingolstadt.

De la contraportada

Helena Maria Krebs analyzes equilibrium credit rationing when banks compete for loans and deposits in a double-sided Bertrand game. Borrowers and lenders are allowed to switch market sides. Thus, investors do not only base their decisions on loan rates, but also on opportunity costs in the form of deposit rates. Credit rationing may occur if adverse selection due to borrowers’ informational advantage leads to a lower expected return on loans if the loan rate increases. In that case, banks may have an incentive to offer loan rates below the market-clearing rate. At these rates loan demand exceeds loan supply. The author reveals the important role of bank equity and its distribution: Banks with high equity offer cheap loans and reject superfluous loan applicants, whom banks with low equity then offer expensive loans. Thereby expensive banks realize a higher expected return on loans than cheap banks. Furthermore, this book is the first to formally model the process of acceptance and rejection of loan applicants as a separate stage of the double-sided Bertrand game after banks have decided on their interest rates. It is shown that for fixed chosen interest rates, the deposit and loan volumes of all banks in a subgame perfect Nash equilibrium of the resource allocation game are uniquely determined.


About the author
Helena Maria Krebs received her PhD from the University of Kaiserslautern-Landau working at the intersectionof economic theory and economics of banking. Now she is a postdoctoral scholar at the Catholic University of Eichstätt-Ingolstadt.

"Sobre este título" puede pertenecer a otra edición de este libro.

Editorial
Springer Gabler
Año de publicación
2024
Idioma
Inglés
ISBN 10 
3658444878
ISBN 13 
9783658444877
Encuadernación
Tapa blanda
Número de páginas
156
Contacto del fabricante
Springer Nature Customer Service Center GmbH
ProductSafety@springernature.com

Europaplatz 3,69115 Heidelberg, Germany
Heidelberg
69115
Alemania