This week aims to answer the following questions:
- How are housing markets and housing equity connected to entrepreneurship and do the connections tell us about financing constraints?
- What role do banks — availability, distance and competition — play in entrepreneurial firm financing?
Required and suggested readings
We will cover three papers and the institutional details required to understand them. Read these three papers and skim the articles on the week 3 reading list.
Petersen, M.A. and Rajan, R.G. (2002) ‘Does Distance Still Matter? The Information Revolution in Small Business Lending’, The Journal of Finance, 57(6), pp. 2533–2570.
Greenstone, M., Mas, A. and Nguyen, H.-L. (2020) ‘Do Credit Market Shocks Affect the Real Economy? Quasi-experimental Evidence from the Great Recession and “Normal” Economic Times’, American Economic Journal: Economic Policy, 12(1), pp. 200–225.
Schmalz, M.C., Sraer, D.A. and Thesmar, D. (2017) ‘Housing Collateral and Entrepreneurship’, The Journal of Finance, 72(1), pp. 99–132.