The changing structure of local credit markets: Are small businesses special?

Patti, Emilia Bonaccorsi di; Gobbi, Giorgio

doi:10.1016/s0378-4266(01)00191-1

Cited by 174 publications

(56 citation statements)

References 24 publications

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“…These contributions emphasise the role of asymmetric information problems in the relationships between lenders and borrowers, and show that credit rationing can occur also in (imperfectly) competitive lending markets (see, for instance, Petersen andRajan, 1995 andDell'Ariccia, 2000). Empirical evidence supporting this approach is offered by Petersen and Rajan (1995), Bonaccorsi di Patti and Gobbi (2001), and by the previously mentioned study by Bonaccorsi di Patti et al (2004). These latter authors use Italian provincial data on 22 industrial sectors (manufacturing industries and constructions) for the period 1996-1999 and find evidence of a bell-shaped relationship between bank market power and firm creation, suggesting that market power in the banking industry is beneficial to firm birth only up to a certain point, after which it exerts a negative impact.…”

Section: Firm Birth: a Brief Review Of The Literaturementioning

confidence: 98%

Banking Market Structure, Creation and Activity of Firms: Early Evidence for Cooperatives in the Italian Case

Gagliardi

2009

Ann Public Coop Econ

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This paper investigates whether local differences in banking competition impact on the creation and activity of firms, with a special focus on cooperatives. The econometric analysis, implemented on a sample of firms operating in the Italian provinces during the years 1998-2003, reveals non-monotonic effects of bank market power on both firm creation and activity. With regard to the former, a bell-shaped relationship is found for both cooperative and non-cooperative firms, suggesting that a moderately concentrated banking market tends to favour firms' creation, regardless of their legal structure. A less homogeneous pattern emerges for firms' activity rate. Indeed, the relationship between bank market power and firm activity rate continues to assume a bell-shaped form in the case of non-cooperative firms. By contrast, a U-shaped parabola is found for cooperatives, showing that active coops in the market benefit from a relatively more intense banking competition.JEL classification: B 52; G 21; L26; L30.

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Section: Firm Birth: a Brief Review Of The Literaturementioning

confidence: 98%

Banking Market Structure, Creation and Activity of Firms: Early Evidence for Cooperatives in the Italian Case

Gagliardi

2009

Ann Public Coop Econ

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“…In order to test this hypothesis, the empirical analysis is carried out on a sample of firms operating in the Italian provinces during the period 1995-2003. Implementing the analysis at the province level, which is the relevant local market in the Italian case, is important because there is significant evidence that credit markets are sub-national-particularly for small firms (Kwast et al 1997;Bonaccorsi di Patti and Gobbi 2001a), so that distance matters in the provision of funds (Petersen and Rajan 2002;Bofondi and Gobbi 2003). Moreover, in Italy the structure of the banking industry differs substantially across local markets and this provides sufficient cross-sectional variability within a single institutional framework (Bonaccorsi di Patti and Dell'Ariccia 2004).…”

Section: Introductionmentioning

confidence: 99%

Financial development and the growth of cooperative firms

Gagliardi

2007

Small Bus Econ

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???The original publication is available at www.springerlink.com???. Copyright Springer.The purpose of this article is to empirically assess the relationship existing between local financial development and the growth of firms, with a special focus on cooperatives. Using Italian data, a multiplicative interaction model is specified, so as to allow the impact of local banking development to differ between cooperative and non-cooperative firms. The main finding is that although local banking development represents a determinant of firms??? growth, regardless of their legal structure, it plays a special role in boosting the growth of cooperatives. This result provides evidence in favor to the existence of an institutional complementarity relationship between the development of local banking institutions and cooperative firms

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“…6 A visual inspection of Figure 1 shows that P ERS1985 2007, besides being higher in the North, is also higher at higher altitudes, as in the Alps and Appennines. 7 A detailed list of variables is available in the Appendix.…”

Section: Datamentioning

confidence: 96%

“…P ERS 1985 2007 is higher in municipalities with population smaller that 15000 inhabitants, as expected due to the aforementioned law, lower in capital cities of provinces and regions (this is likely to be a size e¤ect since capital cities are on average larger than other municipalities), and higher in the North. 6 The last two rows of Table 1 Table 2 reports descriptive statistics for other municipalities' variables that will be used in the empirical analysis, namely labor force participation rate (LF P R), population (P OP ), the elderly index, i.e. the share of inhabitants aged 65 or more (ELD_IN DEX), and the share of foreigners (SH_F OR).…”

Section: Datamentioning

confidence: 99%

“…Many contributions in this literature focus, instead, on the availability of credit, showing that a well functioning, competitive banking system and the physical proximity of banks positively a¤ect …rms'innovation activity (see, among others, Bonaccorsi di Patti and Gobbi [6], King and Levine [19] and Guiso et al [18]). In particular, our empirical approach borrows from the one developed by Benfratello et al [4] who, using previous waves of the same data on Italian …rms, investigate the e¤ect of local banking development, measured by the number of bank branches per capita in a province, on …rms' innovation activity.…”

Section: Introductionmentioning

confidence: 99%

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Persistence of Politicians and Firms' Innovation

Bellettini

Ceroni²,

Prarolo³

2013

Economic Inquiry

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We empirically investigate whether the persistence of politicians in political institutions a¤ects the innovation activity of …rms. We use 12,000 …rm-level observations from three waves of the Italian Observatory over Small and Medium Enterprises, and introduce a measure of political persistence de…ned as the average length of individual political careers in political institutions of Italian municipalities. Standard OLS shows no raw correlation between political persistence and …rms'innovation activity. However, once the causal e¤ect is isolated by means of instrumental variables, using death of politicians as an exogenous source of variation of political persistence, we …nd a robust negative relation between political persistence and the probability of process innovation. This …nding is consistent with the view that political stability may hinder …rms' incentive to innovate to maintain their competitiveness, as long as they can extract rents from long-term connections with politicians.JEL Classi…cation: D22, D72, O31

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The changing structure of local credit markets: Are small businesses special?

Cited by 174 publications

References 24 publications

Banking Market Structure, Creation and Activity of Firms: Early Evidence for Cooperatives in the Italian Case

Banking Market Structure, Creation and Activity of Firms: Early Evidence for Cooperatives in the Italian Case

Financial development and the growth of cooperative firms

Persistence of Politicians and Firms' Innovation

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