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Self-Rationing in European Businesses: Evidence from Survey Analysis

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  • Kallandranis, Christos
  • Drakos, Konstantinos

Abstract

By employing the SAFE survey data set where the credit access trend is observed directly, we explore the so-called discouraged type of borrowers. This category was largely omitted by the traditional credit rationing literature. Incorporating two possible proxies, size and age, which are affecting seeking and access to finance, we provide evidence that both are relevant to the likelihood of discouragement. In particular, size reveals a monotonic drop while age an inverse U relationship with discouragement rates. Discouragement is also strongly affected by overall country conditions.

Suggested Citation

  • Kallandranis, Christos & Drakos, Konstantinos, 2021. "Self-Rationing in European Businesses: Evidence from Survey Analysis," Finance Research Letters, Elsevier, vol. 41(C).
    • Handle: RePEc:eee:finlet:v:41:y:2021:i:c:s1544612320316214
    DOI: 10.1016/j.frl.2020.101807
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    More about this item

    Keywords

    Small Business Lending; Loans; Rationing; Discouraged Borrowers; Survey Data;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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