Learning about Competitors: Evidence from SME Lending.

Autor:	Darmouni, Olivier, Sutherland, Andrew
Předmět:	SMALL business MONEYLENDERS COMPETITIVE advantage in business INFORMATION sharing SERVICE contracts UNFAIR contract terms BANK investment contracts
Zdroj:	Review of Financial Studies; May2021, Vol. 34 Issue 5, p2275-2317, 43p
Abstrakt:	We study how small and medium enterprise (SME) lenders react to information about their competitors' contracting decisions. To isolate this learning from lenders' common reactions to unobserved shocks to fundamentals, we exploit the staggered entry of lenders into an information-sharing platform. Upon entering, lenders adjust their contract terms toward what others offer. This reaction is mediated by the distribution of market shares: lenders with higher shares or that operate in concentrated markets react less. Thus, contract terms are shaped not only by borrower or lender fundamentals but also by the interaction between information availability and competition. [ABSTRACT FROM AUTHOR]
Databáze:	Complementary Index
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