Small Business Loan Turndowns, Personal Wealth, and Discrimination
AbstractWe examine the impact of personal wealth on small business loan turndowns across demographic groups. Information on home ownership, home equity, and personal net worth, in combination with a rich set of explanatory variables, furthers our understanding of the credit market experiences of small businesses across demographic groups. We find substantial unexplained differences in denial rates between African-American-, Hispanic-, Asian-, and white-owned firms. We find that greater personal wealth is associated with a lower probability of loan denial. However, even after controlling for personal wealth, large differences in denial rates across demographic groups remain.
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Bibliographic InfoArticle provided by University of Chicago Press in its journal Journal of Business.
Volume (Year): 78 (2005)
Issue (Month): 6 (November)
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Web page: http://www.journals.uchicago.edu/JB/
Other versions of this item:
- Ken Cavalluzzo & John Wolken, 2002. "Small business loan turndowns, personal wealth and discrimination," Finance and Economics Discussion Series 2002-35, Board of Governors of the Federal Reserve System (U.S.).
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ken Cavalluzzo & Linda Cavalluzzo & John Wolken, 1999.
"Competition, small business financing, and discrimination: evidence from a new survey,"
Federal Reserve Bank of Chicago, issue Mar, pages 180-266.
- Ken Cavalluzzo & Linda Cavalluzzo & John Wolken, 1999. "Competition, small business financing, and discrimination: evidence from a new survey," Finance and Economics Discussion Series 1999-25, Board of Governors of the Federal Reserve System (U.S.).
- David G. Blanchflower & Phillip B. Levine & David J. Zimmerman, 2003.
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The Review of Economics and Statistics,
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