How Did the Financial Crisis Affect Small Business Lending in the United States.

摘要

We use a panel regression model with bank- and year-fixed effects to analyze changes in U.S. bank lending to businesses. We find that bank lending to all businesses and, in particular, to small businesses, declined precipitously following onset of the financial crisis. We also examine the relative changes in business lending by banks that did, and did not, receive TARP funds from the U.S. Treasury following onset of the crisis in 2008. Our analysis reveals that banks receiving capital injections from the TARP failed to increase their small-business lending, even though this was the primary goal of the TARP; instead, these banks decreased their lending by even more than other banks. Additional analysis incorporating county-year fixed effects reveals that the relative declines in lending by TARP banks appear to be demand driven, but re-confirms the failure of TARP banks to increase small-business lending. In summary, these results show that the TARPs Capital Purchase Program failed to boosting bank lending-its primary goal. Our study also provides important new evidence on the determinants of business lending. Most importantly, we find a strong and significant positive relation between bank capital adequacy and business lending, especially small-business lending. This new evidence refutes claims by U.S. banking industry lobbyists that higher capital standards would reduce business lending and hurt the economy. Instead, it shows that higher capital standards would improve the availability of credit to U.S. firms, especially to small businesses.