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Individual Credit Market Experience and Perception of Aggregate Bank Lending. Evidence from a Firm Survey

Author

Listed:
  • Jarko Fidrmuc

    (WIFO)

  • Christa Hainz
  • Werner Hölzl

Abstract

We show that firms' credit market experience determines their perception of aggregate bank lending policy using panel data from the Austrian Business Survey between 2011 and 2016. Loan rejections have a strongly negative and persistent effect on perceptions. Interestingly, firms that receive a loan at worse than anticipated conditions show a similarly negative effect. Firms that do not need a loan tend to perceive lending policy as neutral and revise their perceptions less often. Our findings are in line with theories on sticky information, rational inattention and pessimism bias and suggest considering experience for the aggregation of perceptions.

Suggested Citation

  • Jarko Fidrmuc & Christa Hainz & Werner Hölzl, 2018. "Individual Credit Market Experience and Perception of Aggregate Bank Lending. Evidence from a Firm Survey," WIFO Working Papers 574, WIFO.
    • Handle: RePEc:wfo:wpaper:y:2018:i:574
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    File URL: https://www.wifo.ac.at/wwa/pubid/61587
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    References listed on IDEAS

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    Cited by:

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    2. Florian Horky & Nicola Tretter & Jarko Fidrmuc, 2021. "Are the pandemic and innovation twins? Perceived financial obstacles, innovations, and entrepreneurial success," Economic Research Guardian, Mutascu Publishing, vol. 11(2), pages 236-254, December.

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    Keywords

    Perception of lending policy; behavioral macroeconomics; formation of perceptions; pessimism bias; rational inattention; sticky information;
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