Gender Discrimination in Small Business Lending

Research Seminars: ZEW Research Seminar

Evidence from a Lab-in-the-Field Experiment in Turkey

The paper presented in this ZEW Research Seminar tests for the presence of gender discrimination in small business lending through a lab-in-the-field experiment with 334 Turkish loan officers. Each officer reviews multiple loan applications in which it is randomized the applicant’s gender. While unconditional approval rates are the same for male and female applicants, it is detected a more subtle form of discrimination. Loan officers are 30 percent more likely to make loan approval conditional on the presence of a guarantor when it is presented an application as coming from a female instead of a male entrepreneur. This gender discrimination is concentrated among young, inexperienced, risk averse, and gender-biased loan officers. Discrimination is also most pronounced for loans that perform well in real life, making it costly to the bank. Experimental variation in the available applicant information does not impact lending decisions, suggesting that the nature of discrimination is implicit rather than statistical.

Venue

ZEW – Leibniz-Zentrum für Europäische Wirtschaftsforschung

People

Dr. Ralph de Haas PhD

Ralph de Haas // European Bank for Reconstruction and Development (EBRD), London, United Kingdom

To the profile

Directions

Address

ZEW – Leibniz-Zentrum für Europäische Wirtschaftsforschung

maps

Click the button below to reload the content. (I agree to external content being displayed to me. Read more in our privacy policy).

L 7, 1, 68161 Mannheim
  • Room 2