Our paper studies the role of the collateral channel for bank credit using confidential bank-firm-loan data. We estimate that for a 1 percent increase in collateral values, firms pledging real estate collateral experience a 12 basis point higher growth in bank lending with higher sensitivities...

Our paper studies the role of the collateral channel for bank credit using a confidential bank-firm-loan data set. We find that the use of real estate collateral is concentrated in private bank-dependent borrowers and in markets with low real estate supply elasticities. We identify the...