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Information misreporting in the credit market: analysis of a Credit Bureau's Disciplinary role/ created by Mahmoud Sami Nabi and Souraya Ben Souissi

By: Contributor(s): Material type: TextTextSeries: Comparative economic studies ; Volume 55, number 1Basingstoke: Palgrave Macmillan, 2013Content type:
  • text
Media type:
  • unmediated
Carrier type:
  • volume
ISSN:
  • 08887233
Subject(s): LOC classification:
  • HB90 COM
Online resources: Abstract: Could a Credit Bureau incite banks to report correct information about their borrowers? We develop a spatial competition model à-la Salop (1979) with n interacting banks having the possibility to misreport information to a Credit Bureau. We show that the Credit Bureau can discipline banks and incite them to share information honestly by withdrawing the license of the ‘dishonest’ bank and enforcing a sufficiently high penalty. It is interestingly shown that the penalty threshold that conditions the effectiveness of the Credit Bureau's role depends on the structure of the credit market and the banks’ far-sightedness about their future profits.
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Holdings
Item type Current library Call number Vol info Copy number Status Notes Date due Barcode
Journal Article Journal Article Main Library - Special Collections HB90 COM (Browse shelf(Opens below)) Vol.55, no.1, (pages 145-166) SP14969 Not for loan For In House Use Only

Could a Credit Bureau incite banks to report correct information about their borrowers? We develop a spatial competition model à-la Salop (1979) with n interacting banks having the possibility to misreport information to a Credit Bureau. We show that the Credit Bureau can discipline banks and incite them to share information honestly by withdrawing the license of the ‘dishonest’ bank and enforcing a sufficiently high penalty. It is interestingly shown that the penalty threshold that conditions the effectiveness of the Credit Bureau's role depends on the structure of the credit market and the banks’ far-sightedness about their future profits.

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