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Firm Credit Experience and Perceptions of Lending Policy: Business Survey Evidence from Austria

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  • Hainz, Christa
  • Fidrmuc, Jarko
  • Hölzl, Werner

Abstract

Bank lending has been a major concern since the financial crisis. We study the effect of a firm’s own credit market experience on its perceived bank lending policy using the Austrian Business Climate Survey between 2011 and 2014 and. Our results show that firms’ perceptions of aggregate lending policy depend on their individual credit market experience. Only if they get the loan at the expected terms, firms are more likely to perceive the banks’ lending policy positively. Moreover, firms are more likely to update their perceptions during the period in which they need a loan. Our results are in line with theories on sticky information, rational inattention and pessimism bias when forming perceptions.

Suggested Citation

  • Hainz, Christa & Fidrmuc, Jarko & Hölzl, Werner, 2016. "Firm Credit Experience and Perceptions of Lending Policy: Business Survey Evidence from Austria," VfS Annual Conference 2016 (Augsburg): Demographic Change 145863, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc16:145863
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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