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/lp/american-economic-association/discriminatory-lending-evidence-from-bankers-in-the-lab-e04kPI8Khb
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- Publisher
- American Economic Association
- Copyright
- Copyright © 2023 © American Economic Association
- ISSN
- 1945-7790
- DOI
- 10.1257/app.20210180
- Publisher site
- See Article on Publisher Site
Abstract
AbstractWe implement a lab-in-the-field experiment with 334 Turkish loan officers to document gender discrimination in small business lending and unpack mechanisms. Officers review multiple real-life loan applications in which we randomize applicant gender. While unconditional approval rates are the same, officers are 26 percent more likely to require a guarantor when we present the same application as coming from a female instead of a male entrepreneur. A causal forest algorithm to estimate heterogeneous treatment effects reveals that discrimination is concentrated among young, inexperienced, and gender-biased officers. Discrimination mainly affects female loan applicants in male-dominated industries, indicating how financial frictions can perpetuate entrepreneurial gender segregation across sectors. (JEL C93, G21, G32, J16, L25, L26, O16)
Journal
American Economic Journal Applied Economics – American Economic Association
Published: Apr 1, 2023