Template-Type: ReDIF-Paper 1.0

Author-Name: Daniela Bragoli
Author-X-Name-First: Daniela
Author-X-Name-Last: Bragoli
Author-Email: daniela.bragoli@unicatt.it
Author-Workplace-Name: Università Cattolica del Sacro Cuore
Author-Workplace-Name: Dipartimento di Matematica per le Scienze economiche, finanziarie ed attuariali, Università Cattolica del Sacro Cuore

Author-Name: Chiara Burlina
Author-X-Name-First: Chiara
Author-X-Name-Last: Burlina

Author-Name: Flavia Cortelezzi
Author-X-Name-First: Flavia
Author-X-Name-Last: Cortelezzi

Author-Name: Giovanni Marseguerra
Author-X-Name-First: Giovanni
Author-X-Name-Last: Marseguerra
Author-Email: giovanni.marseguerra@unicatt.it
Author-Workplace-Name: Università Cattolica del Sacro Cuore
Author-Workplace-Name: Dipartimento di Matematica per le Scienze economiche, finanziarie ed attuariali, Università Cattolica del Sacro Cuore


Title: Banking geography, firm performance and the credit cycle

Abstract: This    paper    analyses    the    link    between    spatial    developments  in  the  banking  sector  
and  firm  performance  focusing  on  how  this  relation  evolves  during  the  credit  boom and bust 
which precedes and follows the 2008 crisis. Using a dataset of Italian manufacturing firms and banks at the  province  level  
from  2006  to  2011,  we  show  that  geographical  proximity  (within  banks  and  between  banks  and  borrowers)  matters  
for  firm  performance,  but  has  a  different  impact  during  credit  booms  and  busts.  What  matters  the  most  for  increasing  
firm  performance,  during  the  credit  boom,  is  a  short  distance  between  the  control  centre   of   lending   decision   
and   the   local   branches   (functional  distance),  whereas  during  the  credit  crunch,  
only  the  operational  proximity  of  banks  to  borrowers  becomes an important driver to increase firm performance. 

Length: 34

Creation-Date: 2019-01
File-URL: https://dipartimenti.unicatt.it/dime-dime19_01.pdf
File-Format: Application/pdf
File-Function: First version, 2019
Number: dime19_01
Classification-JEL: R11, P16, L6.
Keywords: banking   geography,   operational   proximity,   functional distance, firm performance, credit cycle.
Handle: RePEc:ctc:sdimse:dime19_01