@article{2018:zurek:the_effect,
title = {The Effects of Spatial Distance on Loan Pricing in Relationship Lending},
year = {2018},
note = {The spatial range between banks and their borrowers has commonly been
considered as ambiguous in literature on borrower-lenderrelationships;
On the one hand, a higher spatial separation increases informational
costs, resulting in ceteris paribus higher interest rates charged by
the lending bank. On the other hand, borrowers located closely to
their lending banks are exposed to the local market power of the
latter and therefore charged higher loan rates. With maintaining a
single bank relationship, firms furthermore might occur liquidity
risks. In this paper, the spatial distance between German firms and
their banks is considered as impact on firms’ lending rate.
Employing Heckman’s two-stage approach, there is strong evidence
that distance has a positive impact on firms’ lending rates in
relationship lending.},
journal = {Die Unternehmung},
pages = {212--228},
author = {Zurek, Maximilian},
volume = {72},
number = {3}
}