Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 10, 2019 erstellt
Description:
Community banks are the central financial institution in many places. They have aunique capacity to alleviate firm credit constraints through economic downturns. This mayincrease economic resilience, delaying or mitigating the effects of the Great Recession. Weestimate how the county-level banking access and community bank market share affect both thetiming and duration of the Great Recession. Using the Cox Proportional Hazards Model, we findthat communities with a higher community bank market share are either less likely to experiencerecession conditions, or experience these conditions later. Using the Heckman Selection model,we confirm these results, and show that communities with a higher community bank market shareare less likely to experience recession conditions. Importantly, we show that these results areindependent of the health of local banks, as we control for the mean tier one capital ratio in ouranalyses. This research provides one of the first links between local financial institutions, andeconomic resilience