Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/210018
Authors: 
Karapetyan, Artashes
Stacescu, Bogdan
Year of Publication: 
2012
Series/Report no.: 
Working Paper No. 2012/19
Publisher: 
Norges Bank, Oslo
Abstract: 
Information sharing and collateral reduce adverse selection costs, but are costly for lenders. When a bank learns more about the types of its rival's borrowers through information sharing (e.g., credit bureaus), it might seem that this information should substitute the role of collateral in screening their types. We instead show that information sharing may increase, rather than decrease, the role of collateral, which can be required in loans to high-risk borrowers in cases when it is not in the absence of information sharing. We extend to show that ex ante screening can substitute both collateral and information sharing.
Subjects: 
bank competition
information sharing
collateral
JEL: 
G21
L13
Persistent Identifier of the first edition: 
ISBN: 
978-82-7553-707-0
Creative Commons License: 
https://creativecommons.org/licenses/by-nc-nd/4.0/deed.no
Document Type: 
Working Paper
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