Competition and Agency Problems Within Banks: Evidence from Insider Lending
研究竞争能否缓解银行内部代理问题，通过内部人贷款衡量代理冲突，发现跨州放松管制带来的竞争增加会减少内部人贷款，表明竞争压力降低管理层自利行为。
This paper studies whether greater competition can mitigate agency problems within banks. We measure the intensity of the agency conflict within a bank by the volume of loans that the bank lends to its insiders (e.g., executives). We first check that these loans are a form of private benefit. By exploiting interstate branching deregulation, we then show that banks react to greater competition by reducing insider lending, especially when the entry of new competitors may more strongly affect bank profitability. Results are robust to using various identification approaches and alternative indicators of agency conflict. We conclude that competitive pressure reduces managerial self-dealing. This paper was accepted by Gustavo Manso, finance.