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Payday-loan bans: evidence of indirect effects on supply

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  • Stefanie R. Ramirez

    (University of Idaho)

Abstract

In November 2008, Ohio enacted the Short-Term Loan Law which imposed a 28% APR on payday loans, effectively banning the industry. Using licensing records from 2006 to 2010, I examine if there are changes in the supply side of the pawnbroker, precious-metals, small-loan, and second-mortgage lending industries during periods when the ban is effective. Seemingly unrelated regression results show the ban increases the average county-level operating small-loan, second-mortgage, and pawnbroker licensees per million by 156, 43, and 97%, respectively.

Suggested Citation

  • Stefanie R. Ramirez, 2019. "Payday-loan bans: evidence of indirect effects on supply," Empirical Economics, Springer, vol. 56(3), pages 1011-1037, March.
    • Handle: RePEc:spr:empeco:v:56:y:2019:i:3:d:10.1007_s00181-018-1447-2
    DOI: 10.1007/s00181-018-1447-2
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    Cited by:

    1. Melody Harvey & Cliff A. Robb & Christopher L. Peterson, 2024. "Law and order? Associations between payday lending prohibition and alternative financial services use by degree of enforcement," Journal of Consumer Affairs, Wiley Blackwell, vol. 58(2), pages 538-557, June.
    2. Stefanie R. Ramirez, 2020. "Regulation And The Payday Lending Industry," Contemporary Economic Policy, Western Economic Association International, vol. 38(4), pages 675-693, October.

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