000			01219nam a22001457a 4500
999			_c522415 _d522415
008			230411b ||||| |||| 00| 0 eng d
100			_aGiorgi, G.D., Drenik, A.and Seria, E. _939712
245			_aThe extension of credit with nonexclusive contracts and sequential banking externalities
260			_aAmerican Economic Journal: Economic Policy
300			_a15(1), Feb, 2023: p.233-271
520			_aNonexclusive sequential borrowing can increase default and impose externalities on prior lenders. We document that sequential banking is pervasive with substantial effects. Using credit card applications from a large bank and data on the applicants' entire loan portfolios, we find that an additional credit line causes a 5.9 percentage point decline in default for high-score borrowers on previous loans. However, for low-score borrowers, it causes a 19 percentage point increase. The former use the new credit to smooth payments on preexisting loans, while the latter increase their total debt. These results have implications for "no-universal-default" regulation and financial inclusion.- Reproduced
773			_aAmerican Economic Journal: Economic Policy
906			_aBANKING AND FINANCE
942			_cAR