Cycles in Lending Standards? - Economic Quarterly Summer 1995
Article
Cycles in Lending Standards?
Cycles in Lending Standards? - Economic Quarterly Summer 1995
Cycles in Lending Standards? - Economic Quarterly Summer 1995
Summer
1995
Cycles in Lending Standards?
John A. Weinberg {johwei1}
<p>Popular and academic discussions of bank lending behavior often invoke the idea of cycles in the standards banks use to screen potential borrowers. Such cycles could result from an inherent tendency for banks to overextend themselves during expansions of credit, taking on excessive risk. On the other hand, a simple analytical model demonstrates that apparent variations in lending standards could be a natural aspect of a well-functioning market’s allocation of funds among heterogeneous users.</p>
/RichmondFedOrg/publications/research/economic_quarterly/1995/summer/pdf/weinberg.pdf
Consumer Finance
1
Financial Institutions
Lending
Consumer Finance
<p>Popular and academic discussions of bank lending behavior often invoke the idea of cycles in the standards banks use to screen potential borrowers. Such cycles could result from an inherent tendency for banks to overextend themselves during expansions of credit, taking on excessive risk. On the other hand, a simple analytical model demonstrates that apparent variations in lending standards could be a natural aspect of a well-functioning market’s allocation of funds among heterogeneous users.</p>
Economic Quarterly
Summer
1995