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Concentration, Hold-Up and Information Revelation in Bank Lending: Evidence From Chilean Firms

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  • Álvaro García
  • Andrea Repetto
  • Sergio Rodríguez
  • Rodrigo Valdés

Abstract

In this paper we empirically study bank-client relationships using a sample of Chilean manufacturing firms. We examine whether concentration and the duration of bank-firm relationships affect the volume of bank lending. Our results indicate that lower concentration, measured by the number of banks a firm borrows from, is associated with a large and positive effect on borrowing. The length of borrower-lender relationships has a positive -although not always statistically significant- effect on the amount borrowed.

Suggested Citation

  • Álvaro García & Andrea Repetto & Sergio Rodríguez & Rodrigo Valdés, 2003. "Concentration, Hold-Up and Information Revelation in Bank Lending: Evidence From Chilean Firms," Working Papers Central Bank of Chile 226, Central Bank of Chile.
  • Handle: RePEc:chb:bcchwp:226
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    References listed on IDEAS

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    Cited by:

    1. Raphael Bergoeing & Andrea Repetto & Raimundo Soto, 2003. "Unveiling the Micro-Dynamics of Sustained Growth in Chile," Documentos de Trabajo 248, Instituto de Economia. Pontificia Universidad Católica de Chile..

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