fundamentals with firm-quarter fixed effects; thus, identification comes from a firm's choice to default against one bank versus … bank relationships comes into doubt …

How does the large market for credit score improvement products affect consumers and market efficiency? For consumers …, we use a randomized encouragement design on a standard credit builder loan (CBL) and find null average effects on scores … credit activity. CBLs induce delinquency on pre-existing loan obligations, suggesting that even a seemingly modest additional …

Standard economic theory says that unsecured, high-interest, short-term debt — such as borrowing via credit cards and … bank overdraft facilities — helps individuals smooth consumption in the event of transitory income shocks. This paper shows … income shock of unemployment. Instead, individuals smooth their credit card debt and overdrafts by adjusting consumption. We …

a bank/brokerage-credit-fueled stock-market bubble. The direct effect is a 25 cent increase in a stock's market …Research on leverage and asset-price fluctuations focuses on the direct effect of lax bank lending enabling financially …-constrained investors to take excessive risks. Ignored are unconstrained investors speculating on higher prices during credit booms. To …

A growing literature shows that credit indicators forecast aggregate real outcomes. While researchers have proposed … simple, frictionless, model explains empirical findings commonly attributed to credit cycles. Our key assumption is that … firms have heterogeneous exposures to underlying economy-wide shocks. This leads to endogenous dispersion in credit quality …

This paper develops a network model of interbank lending, in which banks decide to extend credit to their potential … literature on financial networks, we focus on how anticipation of future defaults may result in ex ante “credit freezes,” whereby … banks refuse to extend credit to one another. We first characterize the terms of the interbank contracts and the patterns of …

separate firm-borrowing shocks from bank-supply shocks using a vast sample of matched bank-firm lending data. We decompose … aggregate loan movements in Japan for the period 1990 to 2010 into bank, firm, industry, and common shocks. The high degree of … role for granular shocks as in Gabaix (2011). We show that idiosyncratic granular bank-supply shocks explain 30-40 percent …

competitive interactions between banks and non-bank lenders (fintech firms). Trust enables lenders to have assured access to …