Is there a relationship between credit information exchange and entrepreneurship? : a cross country evidence

Abstract EN

It's widely admitted that credit information sharing has a positive effect on bank lending, mainly by improving transparency, competitiveness and lowering interest rates.

While many studies investigated the effect of credit information sharing on bank lending none concentrate on the its direct effect on entrepreneurship.

We try to fill this gap by analyzing the relationship between the two major schemes in credit information sharing which are the Credit Registers and the Credit Bureaus and the density of new businesses.

We find that there is a positive significant relationship between both systems and new firms' density.

Nonetheless, we observe that the Credit Bureaus Scheme, which is based on unconstrained cooperation has a higher effect.

Our results suggest that governments should give more importance on credit information sharing while prioritizing Credit Bureaus cooperation.

Entrepreneurship, banking, credit information exchange.