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Credit Markets with Ethical Banks and Motivated Borrowers
Abstract
We investigate the corporate social responsibility of banks. Lenders offer loans to standard and motivated borrowers who undertake either standard or ethical projects. Standard banks have no restriction on the types of projects for which they can provide a loan. Ethical banks, instead, commit to financing only ethical projects, which have social profitability but lower expected revenues. Motivated borrowers are keen to invest in ethical projects and to deal with ethical banks. When they are active, ethical banks increase social welfare because the matching of ethical lenders with motivated borrowers reduces the frictions caused by the agency issue.
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“An analysis of CSR reporting practices in regulatory filings shows that a majority of U.S. public firms disclose at least some CSR information.19”
From Mandatory CSR and sustainability reporting: economic analysis and literature review (2021) · cites this paper as [19]
In the citing paper
“Similar to equity investors, lenders can have a taste for CSR (e.g., Barigozzi and Tedeschi 2015).”
From Mandatory CSR and sustainability reporting: economic analysis and literature review (2021) · cites this paper as Barigozzi and Tedeschi 2015
Citations
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Research works printed but not linked: 23
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Cited by
Sorted by citations
Mandatory CSR and sustainability reporting: economic analysis and literature review
Christensen, H. B., Hail, L., & Leuz, C. (2021) · Review of Accounting Studies · doi:10.1007/s11142-021-09609-5 · Cited by 1,923
Metadata
- Authors
- Barigozzi, F., & Tedeschi, P.
- Affiliations
- 1 University of Bologna and 2Università Cattolica del Sacro Cuore—Milano
- Università Cattolica del Sacro Cuore (IT)
- Venue
- Review of Finance
- Publisher
- Oxford University Press (OUP)
- Published
- 2014-07-08
- Volume
- 19
- Issue
- 3
- Pages
- 1281-1313
- ISSN
- 1382-6662 (ISSN-L)
- 1573-692X
- 1572-3097
- OpenAlex
- W2132459746
- Cited by
- 48
- References
- 0
- Citations by year
- 2026: 3 · 2025: 5 · 2024: 4 · 2023: 4 · 2022: 9 · 2021: 5 · 2020: 2 · 2019: 5 · 2018: 3 · 2017: 5 · 2016: 3
- FWCI
- 8.21
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- European Finance Review (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Archivio istituzionale della ricerca (Alma Mater Studiorum Università di Bologna) (submittedVersion)
- Topics
- Social Sciences › Business, Management and Accounting › Strategy and Management › Corporate Social Responsibility Reporting
- Social Sciences › Economics, Econometrics and Finance › Finance › Sustainable Finance and Green Bonds
- Social Sciences › Business, Management and Accounting › Accounting › Islamic Finance and Banking Studies
- Keywords
- ethical banks, corporate social responsibility, bank lending, ethical project, social profitability, principal-agent problem, social welfare (welfare economics), credit markets, project financing
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- Barigozzi, F., & Tedeschi, P. (2015). Credit Markets with Ethical Banks and Motivated Borrowers. Review of Finance. https://doi.org/10.1093/rof/rfu030
