IDEAS home Printed from https://ideas.repec.org/a/bla/jecsur/v23y2009i5p924-946.html
   My bibliography  Save this article

Collateral And Credit Rationing: A Review Of Recent Empirical Studies As A Guide For Future Research

Author

Listed:
  • Tensie Steijvers
  • Wim Voordeckers

Abstract

The relationship between firms and banks often suffers from informational opacity that may result in credit rationing. In theory, providing collateral to the bank can have a mitigating effect on these informational asymmetries and thus solve the credit-rationing problem. Even though collateral is already a widespread debt contract feature, recent trends predict that, in the future, collateral will become even more important for informationally opaque firms. The aim of this paper is twofold. First, we provide a review of the recently growing empirical research on collateral as a remedy for credit rationing. Second, we would like to pinpoint gaps and limitations in current empirical research. Most studies contend with a flawed research design by not distinguishing between business and personal collateral and excluding other information opaqueness reducing tools such as the strength of the relationship between borrower and lender, loan maturity and covenants. We also discuss the limitations of using a single equation estimation method and the usefulness of incorporating interaction effects into the estimation models. Finally, we provide suggestions for fruitful research avenues that would fill these gaps and enrich the empirical knowledge in this research domain. Copyright © 2009 Blackwell Publishing Ltd.

Suggested Citation

  • Tensie Steijvers & Wim Voordeckers, 2009. "Collateral And Credit Rationing: A Review Of Recent Empirical Studies As A Guide For Future Research," Journal of Economic Surveys, Wiley Blackwell, vol. 23(5), pages 924-946, December.
  • Handle: RePEc:bla:jecsur:v:23:y:2009:i:5:p:924-946
    as

    Download full text from publisher

    File URL: http://www.blackwell-synergy.com/servlet/useragent?func=synergy&synergyAction=showTOC&journalCode=joes&volume=23&issue=5&year=2009&part=null
    File Function: link to full text
    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:bla:jecsur:v:23:y:2009:i:5:p:924-946. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0950-0804 .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.