Credit Rationing And Black-Owned Firms: Is There Evidence Of Discrimination?
AbstractThis article uses data from the 2003 Survey of Small Business Finances to determine if banks ration credit more severely to black-owned firms. Our results reveal this is the case. Using the Heckman two-step procedure, we determined that black- and white-owned firms have a comparable demand for credit as measured by their actual use of lines of credit. Controlling for firm and owner characteristics, however, black-owned firms had lower line of credit limits suggesting constraints in supply. Further, our findings suggest the supply of credit to black-owned firms is even more severely constrained than other minority-owned firms. These findings highlight the possibility of discrimination against black-owned firms in the form of credit rationing.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by World Scientific Publishing Co. Pte. Ltd. in its journal Journal of Developmental Entrepreneurship.
Volume (Year): 14 (2009)
Issue (Month): 03 ()
Contact details of provider:
Web page: http://www.worldscinet.com/jde/jde.shtml
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Grace Kim, 2011. "Minority Small-Firm Credit Applicants: Does Persistence Pay?," Journal of Entrepreneurial Finance, Pepperdine University, Graziadio School of Business and Management, vol. 15(2), pages 91-106, Winter.
- Annie bellier & Wafa Sayeh & Stéphanie Serve, 2012. "What lies behind credit rationing? A survey of the literature," THEMA Working Papers 2012-39, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Tai Tone Lim).
If references are entirely missing, you can add them using this form.