The Brazilian Payroll Lending Experiment

In December 2003, the Brazilian Congress passed a law that led to a natural personal lending experiment. The law allows banks to offer loans with repayment through automatic payroll deduction, which, in effect, turns future income into collateral. We estimate the impact of the new law using auto loans as a control group. The law has caused a reduction in interest rates and an increase in the volume of personal credit. © 2012 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Year of publication:	2012
Authors:	Coelho, Christiano A. ; Mello, João M.P. De ; Funchal, Bruno
Published in:	The Review of Economics and Statistics. - MIT Press. - Vol. 94.2012, 4, p. 925-934
Publisher:	MIT Press
Subject:	payroll \| loans \| credit markets \| collateral \| difference-in-differences \| Brazil

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Extent:	application/pdf
Type of publication:	Article
Classification:	G21 - Banks; Other Depository Institutions; Mortgages ; D01 - Microeconomic Behavior: Underlying Principles ; C33 - Models with Panel Data ; K00 - Law and Economics. General ; E44 - Financial Markets and the Macroeconomy
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011010012