relation between loan risk and collateral. Specifically, we posit that different economic characteristics or types of … collateral pledges may be associated with the empirical dominance of the four different risk-collateral channels implied by … economic theory. For our sample, collateral overall is associated with lower loan risk premiums and a higher probability of ex …

Collateral is a widely used, but not well understood, debt-contracting feature. Two broad strands of theoretical … literature explain collateral as arising from the existence of either ex ante private information or ex post incentive problems … private information about borrower risk that is unobserved by the lender. The data also include public information about …

extracting the full surplus from projects, so that she inefficiently rejects marginally profitable projects. Collateral mitigates … rejects. The model predicts that, controlling for observable borrower risk, collateralized loans are more likely to default ex … relatively smaller information advantage face higher collateral requirements, and that technological innovations that narrow the …

In the aftermath of the global financial crisis, the market for unsecured credit literally dried out and collateral … than using them as collateral. The aim of this paper is to develop a non-equivalence between secured credit and outright … as collateral is a best response. …

In theory, the use of collateral in credit contracting should mitigate the information problems that are widely held to … be the primary cause of credit rationing. However, direct empirical evidence of the link between collateral use and … credit rationing is scant. This paper examines the relationship between collateral and credit rationing using survey data …

We investigate the impact of bank competition on the use of collateral in loan contracts. We develop a theoretical … borrower and asking for collateral. We show that the presence of collateral is more likely when bank competition is low. We … presence of collateral on bank competition, measured by the Lerner index. Our empirical tests corroborate the theoretical …

We construct a unified framework to study credit rationing by the loan size. Due to default risk, the loan offer curve …

Collateral is one of the most important features of a debt contract. A substantial theoretical literature motivates the … use of collateral as a means to alleviate ex-ante and ex-post information asymmetries between borrowers and lenders and … the incidence of credit rationing. Through its seniority effect, collateral may also affect banks’ incentives to monitor …

empirical relation between collateral and loan risk. We posit that certain economic characteristics of collateral may be … associated with the empirical dominance of different risk-collateral channels implied by economic theory, namely the “lender … predictions regarding the empirical relations between collateral and loan risk. For our sample of commercial loans, we find that …

Collateral is a widely used, but not well understood, debt contracting feature. Two broad strands of theoretical … literature explain collateral as arising from the existence of either ex ante private information or ex post incentive problems … private information about borrower risk that is unobserved by the lender. The data also includes public information about …