Arbeitspapier

Rent-seeking in elite networks

We employ a unique dataset on members of an elite service club in Germany to investigate how social connections in elite networks affect the allocation of resources. Specifically, we investigate credit allocation decisions of banks to firms inside the network. Using a quasi-experimental research design, we document misallocation of bank credit inside the network, with bankers with weakly aligned incentives engaging most actively in crony lending. Our findings, thus, resonate with existing theories of elite networks as rent extractive coalitions that stifle economic prosperity.

Language: Englisch

Bibliographic citation: Series: SAFE Working Paper ; No. 132

Classification: Wirtschaft
International Lending and Debt Problems
International Finance Forecasting and Simulation: Models and Applications
Banks; Depository Institutions; Micro Finance Institutions; Mortgages
Financial Institutions and Services: Government Policy and Regulation
Bankruptcy; Liquidation
Other Substantive Areas of Law: Other

Event: Geistige Schöpfung

(who): Haselmann, Rainer
Schoenherr, David
Vig, Vikrant

Event: Veröffentlichung

(who): Goethe University Frankfurt, SAFE - Sustainable Architecture for Finance in Europe

(where): Frankfurt a. M.

(when): 2017

DOI: doi:10.2139/ssrn.2911062

Handle: http://hdl.handle.net/10419/149751

Last update: 10.03.2025, 11:43 AM CET

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Object type

Arbeitspapier

Associated

Haselmann, Rainer
Schoenherr, David
Vig, Vikrant
Goethe University Frankfurt, SAFE - Sustainable Architecture for Finance in Europe

Time of origin

2017

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