New York University Stern School of Business
44 West Fourth Street
New York, NY
Institutional Affiliation: New York University
NBER Working Papers and Publications
|September 2018||The Equilibrium Effects of Information Deletion: Evidence from Consumer Credit Markets|
with Christopher Neilson, Luis Opazo, Seth Zimmerman: w25097
This paper studies the equilibrium effects of information restrictions in credit markets using a large-scale natural experiment. In 2012, Chilean credit bureaus were forced to stop reporting defaults for 2.8 million individuals (21% of the adult population). Using panel data on the universe of bank borrowers in Chile combined with the deleted registry information, we implement machine learning techniques to measure changes in the predictions lenders can make about default rates following deletion. Deletion lowers (raises) predicted default the most for poorer defaulters (non-defaulters) with limited borrowing histories. Using a difference-in-differences design, we show that individuals exposed to increases in predicted default reduce borrowing by 6.4% following deletion, while those expose...
|August 2018||Measuring Bias in Consumer Lending|
with Will Dobbie, Daniel Paravisini, Vikram Pathania: w24953
This paper tests for bias in consumer lending decisions using administrative data from a high-cost lender in the United Kingdom. We motivate our analysis using a simple model of bias in lending, which predicts that profits should be identical for loan applicants from different groups at the margin if loan examiners are unbiased. We identify the profitability of marginal loan applicants by exploiting variation from the quasi-random assignment of loan examiners. We find significant bias against both immigrant and older loan applicants when using the firm's preferred measure of long-run profits. In contrast, there is no evidence of bias when using a short-run measure used to evaluate examiner performance, suggesting that the bias in our setting is due to the misalignment of firm and examiner ...
|July 2016||The Labor Market Effects of Credit Market Information|
with Marieke Bos, Emily Breza: w22436
Credit information affects the allocation of consumer credit, but its effects on other markets that are relevant for academic and policy analysis are unknown. This paper measures the effect of negative credit information on the employment and earnings of Swedish individuals at the margins of the formal credit and labor markets. We exploit a policy change that generates quasi-exogenous variation in the retention time of past delinquencies on credit reports and estimate that one additional year of negative credit information causes a reduction in wage earnings of $1,000. In comparison, the decrease in credit is only one-fourth as large. Negative credit information also causes an increase in self-employment and a decrease in mobility. We exploit differences in the information available to emp...
Published: Marieke Bos & Emily Breza & Andres Liberman, 2018. "The Labor Market Effects of Credit Market Information," The Review of Financial Studies, vol 31(6), pages 2005-2037. citation courtesy of