The emergence of information sharing in credit markets

M Brown, C Zehnder - Journal of Financial Intermediation, 2010 - Elsevier
We provide the first systematic empirical analysis of how asymmetric information and
competition in the credit market affect voluntary information sharing between lenders. We
study an experimental credit market in which information sharing can help lenders to
distinguish good borrowers from bad ones. Lenders may, however, also lose market power
by sharing information with competitors. Our results suggest that asymmetric information in
the credit market increases the frequency of information sharing between lenders …
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