Using the context of the financial reform and the development of the non-state sector in China in the past decade, we examine the roles that the quality of information disclosure and property rights play in the allocation of different types of bank credit. We find that foreign banks and policy...

This study investigates the effects of bank equity connections and intellectual property protection on enterprises’ innovation behavior, and the regulating effect of intellectual property protection on the relationship between bank equity connections and innovation. In general, bank equity...

To gain a better understanding of the financing motive theories of trade credit, we trace a sample of young firms from their start in 2004 through 2011 and document two main empirical regularities. First, we find that supplier lending is only a supplementary form of financing among these firms,...

Objective - This paper uses a sample of annual observations of European banks to examine whether the liquidity risk affects a bank's risk-taking behavior and its future loan growth.Methodology – A sample of European banks (27 member countries of the European Union plus U.K.) over the period of...

Banks’ lending decisions to small firms are not based on financial ratios, while suppliers lend to clients with strong sales. So entrepreneurial firms might find it easier to borrow from banks, and rely more on bank lending than on supplier lending. We further find that suppliers are quite...

This paper provides, for the first time, large-scale evidence that liquidity transformation by banks creates fragility, as their uninsured depositors face an incentive to withdraw their money before others (a so-called panic run). Such fragility manifests itself in stronger sensitivity of...

Applying a difference-in-differences approach to explore variations in the timing of bank mergers in the U.S. over the last two decades, we document an increase in borrowers' disclosure when their banks engage in mergers and acquisitions. The effect is stronger among borrowers more reliant on...