Convergence of credit structure around the world

Léon, Florian

doi:10.1016/j.econmod.2017.07.021

Cited by 39 publications

(15 citation statements)

References 27 publications

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“…In addition, this trend is occurring faster in low-income countries, suggesting a possible convergence of credit maturity. This trend appears rather similar to that observed by Léon (2018), highlighting the existence of a convergence of credit structure.…”

supporting

confidence: 84%

“…We therefore test whether our findings are robust to the inclusion of the ratio of household credit over GDP (in columns (1-2)). The ratio of household credit to GDP is extracted from the Credit Structure Database (Léon, 2018 B, columns (1-2)). This result is in line with Herkenhoff et al (2016) who suggest that consumer credit access matters for entrepreneurship in the U.S and that entrepreneurs may divert household credit to alleviate their credit constraints.…”

Section: Robustness Checksmentioning

confidence: 99%

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Long-term finance and entrepreneurship

Léon

2019

Economic Systems

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This paper investigates whether long-term finance affects the firm entry across the world. We construct a new database on short-term and long-term credit provided by commercial banks to the private sector in 85 countries over the period 1995-2014. We then analyze whether differences in entrepreneurship are correlated with the provision of short-term and long-term bank credit. Data on entrepreneurship are extracted from two frequently used databases: the Global Entrepreneurship Monitoring dataset and Entrepreneurship Database, each of which captures different aspects of firm creation. Econometric results indicate that long-term credit does not stimulate the firm entry. On the contrary, we find that short-term credit exerts a positive impact at each stage of firm creation from activity birth to registration. Our findings are robust to a battery of sensitivity tests, including additional control variables, alternative dependent variables, alternative sample, and changes in econometric specification. Our findings suggest that better provision of short-term credit allows entrepreneurs to apply for a formal loan instead of relying exclusively on informal loans or internal funds, contrary to long-term loans.

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confidence: 84%

Section: Robustness Checksmentioning

confidence: 99%

Long-term finance and entrepreneurship

Léon

2019

Economic Systems

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“…convergence in the prevalence of consumer credit (Leon 2017, Bahadir and Valev 2017, Jappelli et al 2013: in countries with less consumer debt, the growth of lending is more intense than in those with more as laggards are catching up with leaders. Yet the convergence in scale is not the same as growing similarity in the way people borrow --door-step lenders are common in the U.K. and Hungary, but not in the U.S. or Germany, and mortgages are much more prevalent in Denmark than in Italy.…”

mentioning

confidence: 99%

Consumer Credit in Comparative Perspective

Róna‐Tas

Guseva

2018

Annu. Rev. Sociol.

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We review the literature in sociology and related fields on the fast global growth of consumer credit and debt and the possible explanations for this expansion. We describe the ways people interact with the strongly segmented consumer credit system around the world—more specifically, the way they access credit and the way they are held accountable for their debt. We then report on research on two areas in which consumer credit is consequential: its effects on social relations and on physical and mental health. Throughout the article, we point out national variations and discuss explanations for these differences. We conclude with a brief discussion of the future tasks and challenges of comparative research on consumer credit.

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“…Turning to the democratization of leverage, we use three different national series of household mortgage and consumer debt (Bank for International Settlements, 2017a; Léon, 2017).…”

Section: Empirical Tests Of the Argumentmentioning

confidence: 99%

Great Expectations, Financialization, and Bank Bailouts in Democracies

Chwieroth

Walter

2020

Comparative Political Studies

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Accelerating financialization and rising societal wealth have meant that democratic governments increasingly provide bailouts following banking crises. Using a new long-run data set, we show that despite frequent and virulent crises before World War II, bank bailouts to protect wealth were then exceptionally rare. In recent decades, by contrast, governments have increasingly opted for extensive bailouts—well before the major interventions of 2007–2009. We argue that this policy shift is the consequence of the “great expectations” of middle-class voters overlooked in existing accounts. Associated with the growing financialization of wealth, rising leverage, and accumulating ex ante financial stabilization commitments by governments, these expectations are suggestive of substantially altered policy preferences and political cleavages. Since the 1970s, when severe banking crises returned as an important threat to middle-class wealth, this “pressure from below” has led elected governments to provide increasingly costly bailouts with no historical precedent.

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Convergence of credit structure around the world

Cited by 39 publications

References 27 publications

Long-term finance and entrepreneurship

Long-term finance and entrepreneurship

Consumer Credit in Comparative Perspective

Great Expectations, Financialization, and Bank Bailouts in Democracies

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