Expositor
Jose Eduardo Gómez, Ph. D en Economía y Master en Economía de la Universidad de Cornell. Profesor Invitado de la Universidad de La Sabana.
Más información clic aquí
Fecha: miércoles, 31 de julio de 2019
Hora: 4:30 p.m - 5:30 p.m.
Lugar: Bloque 27, auditorio 101 , Universidad EAFIT
Entrada libre
Abstract
We present new measures of market power for the banking industry in Colombia and estimate their effect on the cost of credit for non-financial firms. Our results suggest that bank competition increased during the 2006-2008 period–even as concentration increased–but decreased thereafter. Using a unique combination of loan, firm and bank-level datasets we are also able to show that, conditional on firm size, higher bank market power increases interest rates for firms with shorter credit relationships. This is consistent with banks investing in information acquisition when starting new relationships, and being able to cover such investments by exerting market power. We also find that, conditional on firm credit history, reducing bank market power lowers interest rates for larger firms. This suggest that size may be capturing other firm attributes such as scale effects or implicit collateral. Finally, we show that conditioning on a full set of fixed effects, especially firm-time fixed effects which isolate demand-side shocks, is essential in obtaining our results
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Bank Market Power and Firm Finance Evidence from Bank and Loan Level Data.pdf