Credit Rationing and Internal Ratings in the face of Innovation and Uncertainty
Some empirical investigations are pointing to the fact that high-tech firms are subject to credit rationing to a higher extent than the average. This excess of credit rationing may not be due to information asymmetries, but rather to the inability of credit institutions to screen projects in novel fields. This article provides a model of this phenomenon and explores its implications in the light of recent changes in the screening procedures of major banks. In particular, the changes to be made in order to comply with the ``Basel II'' accord emphasize the impact of screening procedures on credit rationing.
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.:
- Allen, Franklin & Gale, Douglas, 1999.
"Diversity of Opinion and Financing of New Technologies,"
Journal of Financial Intermediation,
Elsevier, vol. 8(1-2), pages 68-89, January.
- Franklin Allen & Douglas Gale, 1999. "Diversity of Opinion and Financing of New Technologies," Center for Financial Institutions Working Papers 98-30, Wharton School Center for Financial Institutions, University of Pennsylvania.
- Allen, Franklin & Gale, Douglas, 1998. "Diversity of Opinion and Financing of New Technologies," Working Papers 98-29, C.V. Starr Center for Applied Economics, New York University.
- Gary A. Dymski, 1992. "A "New View" of the Role of Banking Firms in Keynesian Monetary Theory," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 14(3), pages 311-320, April.
- G. Fioretti, 1996. "A Concept of Complexity for the Social Sciences," Working Papers wp96144, International Institute for Applied Systems Analysis.
- Guido Fioretti & Bauke Visser, 2004. "A Cognitive Approach to Organizational Complexity," Tinbergen Institute Discussion Papers 04-033/1, Tinbergen Institute.
- Brunner, Antje & Pieter, Jan & Weber, Martin, 2000. "Information production in credit relationship: On the role of internal ratings in commercial banking," CFS Working Paper Series 2000/10, Center for Financial Studies (CFS).
- Herbert A. Simon, 2002. "Near decomposability and the speed of evolution," Industrial and Corporate Change, Oxford University Press, vol. 11(3), pages 587-599, June.
- Guiso, Luigi, 1998.
"High-tech firms and credit rationing,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 35(1), pages 39-59, March.
- William B. English & William R. Nelson, 1999. "Bank risk rating of business loans," Proceedings 619, Federal Reserve Bank of Chicago.
- G. Atzeni & C. Piga, 2003. "Credit Rationing in High-Tech firms and sample selection," Working Paper CRENoS 200304, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
- Koen Frenken & Luigi Marengo & Marco Valente, 1999. "Interdependencies, nearly-decomposability and adaption," CEEL Working Papers 9903, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
- Grunert, Jens & Norden, Lars & Weber, Martin, 2002.
"The Role of Non-financial Factors in Internal Credit Ratings,"
CEPR Discussion Papers
3415, C.E.P.R. Discussion Papers.
- Grunert, Jens & Norden, Lars & Weber, Martin, 2005. "The role of non-financial factors in internal credit ratings," Journal of Banking & Finance, Elsevier, vol. 29(2), pages 509-531, February.
- Crouhy, Michel & Galai, Dan & Mark, Robert, 2001. "Prototype risk rating system," Journal of Banking & Finance, Elsevier, vol. 25(1), pages 47-95, January.
- Weber, Martin & Krahnen, Jan Pieter & Voßmann, Frank, 1998. "Risikomessung im Kreditgeschäft: Eine empirische Analyse bankinterner Ratingverfahren," Sonderforschungsbereich 504 Publications 98-45, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
- Massimo Egidi, 2003.
"Decomposition patterns in problem solving,"
CEEL Working Papers
0303, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
- Elsas, Ralf & Krahnen, Jan Pieter, 1998.
"Is relationship lending special? Evidence from credit-file data in Germany,"
CFS Working Paper Series
1998/05, Center for Financial Studies (CFS).
- Elsas, Ralf & Krahnen, Jan Pieter, 1998. "Is relationship lending special? Evidence from credit-file data in Germany," Journal of Banking & Finance, Elsevier, vol. 22(10-11), pages 1283-1316, October.
- Stiglitz, Joseph E & Weiss, Andrew, 1981. "Credit Rationing in Markets with Imperfect Information," American Economic Review, American Economic Association, vol. 71(3), pages 393-410, June.
- Bertocco Giancarlo, 2003. "The economics of financing firms: the role of banks," Economics and Quantitative Methods qf0312, Department of Economics, University of Insubria.
- Herbert A. Simon, 1996. "The Sciences of the Artificial, 3rd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262691914, March.
- Treacy, William F. & Carey, Mark, 2000. "Credit risk rating systems at large US banks," Journal of Banking & Finance, Elsevier, vol. 24(1-2), pages 167-201, January.
- Thomas F. Brady & William B. English & William R. Nelson, 1998. "Recent changes to the Federal Reserve's survey of terms of business lending," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Aug, pages 604-615.
- Macmillan, Ian C. & Zemann, Lauriann & Subbanarasimha, P. N., 1987. "Criteria distinguishing successful from unsuccessful ventures in the venture screening process," Journal of Business Venturing, Elsevier, vol. 2(2), pages 123-137.
- Martin H. Wolfson, 1996. "A Post Keynesian Theory of Credit Rationing," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 18(3), pages 443-470, April.
- Stefano Brusoni & Luigi Marengo & Andrea Prencipe & Marco Valente, 2004. "The Value and Costs of Modularity: A Cognitive Perspective," SPRU Working Paper Series 123, SPRU - Science and Technology Policy Research, University of Sussex.
- Heiner, Ronald A., 1988. "The necessity of imperfect decisions," Journal of Economic Behavior & Organization, Elsevier, vol. 10(1), pages 29-55, July.
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpfi:0504021. 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: (EconWPA)
If references are entirely missing, you can add them using this form.