Soft information and the geography of SME bank lending

Tianshu Zhao, Kul B. Luintel, Kent Matthews

    Research output: Journal PublicationArticlepeer-review

    1 Citation (Scopus)

    Abstract

    This paper explores the geography of bank lending to small and medium-sized enterprises (SMEs) and tests the argument that large institutions with complex organizational structures are better able to filter ‘hard’ information than ‘soft’ information. Mortgage lending is used as a control to illustrate the case of ‘hard’ and ‘soft’ information. Using data on individual bank lending to SMEs and mortgages by postcode area in Great Britain for the period 2013(2)–2014(4), the paper explains the spatial dispersion of SME lending in the UK in terms of geographical distance and supports the policy of establishing a geographically decentralized financial system as a counterbalance.

    Original languageEnglish
    Pages (from-to)679-692
    Number of pages14
    JournalRegional Studies
    Volume55
    Issue number4
    DOIs
    Publication statusPublished - 3 Apr 2021

    Keywords

    • bank finance
    • functional distance
    • geography of small and medium-sized enterprise lending

    ASJC Scopus subject areas

    • Environmental Science (all)
    • Social Sciences (all)

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