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Legal rights, information sharing, and private credit: New cross-country evidence

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  • Nketcha Nana, P.V.

Abstract

Using improved measures and recent data from Doing Business, this paper reexamines the effects of legal systems and information-sharing on private credit. The results indicate that stronger legal rights, better contract enforceability and better information sharing are associated with higher private credit to GDP ratios across countries. These effects are significant even when the sample is restricted to include either developing countries only or poor countries only, but the effects of both legal rights and enforcement are stronger the richer the countries. Still, there is no evidence of substitution patterns among credit market institutions in poor countries. Overall, this paper may be viewed as enhancing the robustness as well as the generalizability of earlier evidence aimed at establishing a link between legal and information-sharing institutions on one hand, and the size of credit market on other hand.

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  • Nketcha Nana, P.V., 2014. "Legal rights, information sharing, and private credit: New cross-country evidence," The Quarterly Review of Economics and Finance, Elsevier, vol. 54(3), pages 315-323.
    • Handle: RePEc:eee:quaeco:v:54:y:2014:i:3:p:315-323
    DOI: 10.1016/j.qref.2014.02.002
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    1. Samuel Fosu & Albert Danso & Henry Agyei-Boapeah & Collins G. Ntim & Emmanuel Adegbite, 2020. "Credit information sharing and loan default in developing countries: the moderating effect of banking market concentration and national governance quality," Review of Quantitative Finance and Accounting, Springer, vol. 55(1), pages 55-103, July.
    2. Claudio O. de Moraes & Gustavo F.S. Duarte & Renan F. Nascimento, 2022. "Credit information and financial development," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 2182-2193, April.
    3. Stef, Nicolae & Dimelis, Sophia, 2020. "Bankruptcy regime and the banking system," Economic Modelling, Elsevier, vol. 87(C), pages 480-495.
    4. Samuel Fosu & Albert Danso & Henry Agyei‐Boapeah & Collins G. Ntim, 2021. "Credit information sharing and bank loan pricing: Do concentration and governance matter?," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 5884-5911, October.

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