The DOI matches its Crossref record; 5 of the 5 references it cites were found in a registry or an index.
Asymmetric Information, Bank Lending, and Implicit Contracts: A Stylized Model of Customer Relationships
Abstract
Customer relationships arise between banks and firms because, in the process of lending, a bank learns more than others about its own customers. This information asymmetry allows lenders to capture some of the rents generated by their older customers; competition thus drives banks to lend to new firms at interest rates which initially generate expected losses. As a result, the allocation of capital is shifted toward lower quality and inexperienced firms. This inefficiency is eliminated if complete contingent contracts are written or, when this is costly, if banks can make nonbinding commitments that, in equilibrium, are backed by reputation.
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Citations
Cites
Credit Rationing in Markets with Imperfect Information
Stiglitz, J. E., & Weiss, A. (1981) · Columbia University · doi:10.7916/d8v12ft1 · Cited by 12,769
The Role of Market Forces in Assuring Contractual Performance
Klein, B., & Leffler, K. B. (1981) · Journal of Political Economy · doi:10.1086/260996 · Cited by 3,653
Non-Monetary Effects of the Financial Crisis in the Propagation of the Great Depression
Bernanke, B. (1983) · National Bureau of Economic Research · doi:10.3386/w1054 · Cited by 2,173
Some evidence on the uniqueness of bank loans
James, C. (1987) · Journal of Financial Economics · doi:10.1016/0304-405x(87)90003-1 · Cited by 1,610
Credit rationing and implicit contract theory
Fried, J., & Howitt, P. (1980) · Journal of Money, Credit and Banking · doi:10.2307/1991722 · Cited by 219
Cited by
What Do We Know about Capital Structure? Some Evidence from International Data
RAJAN, R. G., & ZINGALES, L. (1995) · The Journal of Finance · doi:10.1111/j.1540-6261.1995.tb05184.x · Cited by 6,538
The Benefits of Lending Relationships: Evidence from Small Business Data
PETERSEN, M. A., & RAJAN, R. G. (1994) · The Journal of Finance · doi:10.1111/j.1540-6261.1994.tb04418.x · Cited by 5,440
Insiders and Outsiders: The Choice between Informed and Arm's‐Length Debt
RAJAN, R. G. (1992) · The Journal of Finance · doi:10.1111/j.1540-6261.1992.tb04662.x · Cited by 3,902
N. Berger, A., & F. Udell, G. (1998) · Journal of Banking & Finance · doi:10.1016/s0378-4266(98)00038-7 · Cited by 3,690
“…may play a positive role for the small business customer by allowing the bank to enforce long-term implicit contracts in which the borrower receives a subsidized interest rate in the short term, and then compensates the bank by paying a higher-than-competitive rate in a later period (Sharpe 1990).”
Financial Development and Economic Growth: Views and Agenda
Levine, R. (1999) · Policy Research Working Papers · doi:10.1596/1813-9450-1678 · Cited by 2,977
Metadata
- Authors
- SHARPE, S. A.
- Venue
- The Journal of Finance
- Publisher
- Wiley
- Published
- 1990-09
- Volume
- 45
- Issue
- 4
- Pages
- 1069-1087
- ISSN
- 0022-1082 (ISSN-L)
- 1540-6261
- OpenAlex
- W1970594241
- Cited by
- 2,324
- References
- 5
- FWCI
- 11.41
- Type
- journal article
- Language
- en
- Open access
- closed
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- SHARPE, S. A. (1990). Asymmetric Information, Bank Lending, and Implicit Contracts: A Stylized Model of Customer Relationships. The Journal of Finance. https://doi.org/10.1111/j.1540-6261.1990.tb02427.x
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
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