SELEÇÃO ADVERSA E CONCORRÊNCIA NO MERCADO DE CRÉDITO PARA PESSOA FÍSICA NO BRASIL / ADVERSE SELECTION AND COMPETITION IN THE MARKET FOR HOUSEHOLD CREDIT IN BRAZIL

AUTOR(ES)
DATA DE PUBLICAÇÃO

2008

RESUMO

This paper tests and find evidence that support the view that credit interest rates respond more to increases than to decreases in the Central Bank basic interest rate (Selic). This asymmetry is robust to an event analysis, in which the availability of a dataset containing daily information is explored in order to isolate monetary policy shocks on interest rates. Among the possible explanations for this asymmetry, two are considered in the article. The first one refers to the existence of market power, which allows banks to coordinate on a smaller pass-through in order to increase profits in the short run. The second refers to the potential existence of severe adverse selection issues in the credit market, which diminishes the incentives to compete on the interest rate dimension and consequently the pass-through from decreases in the cost of funds. Since the two theories present similar empirical implications in reduced forma analysis, the article proposes and estimates a structural model in order to test which of the competing theories better fits the observed data on prices and quantities for household credit in Brazil.

ASSUNTO(S)

pass-through microeconomics selecao adversa microeconomia adverse selection pass-through

ACESSO AO ARTIGO

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