The bank's market power and the interest-rate elasticity of demand for housing : an econometric study of discrimination on French mortgage data
Résumé
We specify several variants of a structural econometric model explaining mortgage interest rates and loan sizes simultaneously. The models are estimated by simultaneous equation methods with a sample of loan files originated from a French mortgage lender. They yield estimates of the interest-rate elasticity of the demand for housing. Different occupational status groups happen to have different values of structural preference parameters.We show how these differences translate into differential treatment of socio-economic
groups by the banker.
groups by the banker.
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