Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/265872 
Year of Publication: 
2022
Series/Report no.: 
UCD Centre for Economic Research Working Paper Series No. WP22/14
Publisher: 
University College Dublin, UCD School of Economics, Dublin
Abstract: 
Using a unique corporate loans dataset for entrepreneurs with small and microenterprises, this paper examines how educational attainment affects bank credit decisions and subsequent individual and firm outcomes. Our results highlight a "Matthew Effect," where an initial advantage is self-amplifying. We find that entrepreneurs who obtain university education are more likely to apply for credit, and receive higher credit scores, and better lending terms. Via this credit channel, such entrepreneurs have significantly better future firm outcomes compared to those without a university education. Furthermore, we find a key role for investments in innovation, intangible assets, and lower within-firm pay inequality.
Subjects: 
Education
Credit
Higher education
Loan application
Bank credit decisions
Firmperformance
Pay Inequality
JEL: 
G21
G32
I23
I24
I26
Document Type: 
Working Paper

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