IDEAS home Printed from https://ideas.repec.org/a/pal/compes/v55y2013i1p145-166.html
   My bibliography  Save this article

Information Misreporting in the Credit Market: Analysis of a Credit Bureau's Disciplinary Role

Author

Listed:
  • Mahmoud Sami Nabi

    (LEGI-Tunisia Polytechnic School, University of Carthage, BP 743, 2078 La Marsa, Tunisia and Economic Research Forum, Cairo, Egypt.)

  • Souraya Ben Souissi

    (LEGI-Tunisia Polytechnic School, University of Carthage, BP 743, 2078 La Marsa, Tunisia.)

Abstract

Could a Credit Bureau incite banks to report correct information about their borrowers? We develop a spatial competition model à-la Salop (1979) with n interacting banks having the possibility to misreport information to a Credit Bureau. We show that the Credit Bureau can discipline banks and incite them to share information honestly by withdrawing the license of the ‘dishonest’ bank and enforcing a sufficiently high penalty. It is interestingly shown that the penalty threshold that conditions the effectiveness of the Credit Bureau's role depends on the structure of the credit market and the banks’ far-sightedness about their future profits.

Suggested Citation

  • Mahmoud Sami Nabi & Souraya Ben Souissi, 2013. "Information Misreporting in the Credit Market: Analysis of a Credit Bureau's Disciplinary Role," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 55(1), pages 145-166, March.
  • Handle: RePEc:pal:compes:v:55:y:2013:i:1:p:145-166
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/ces/journal/v55/n1/pdf/ces201233a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: http://www.palgrave-journals.com/ces/journal/v55/n1/full/ces201233a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:compes:v:55:y:2013:i:1:p:145-166. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.