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Table 6 Impact of Dodd-Frank Act on aggregate county-level small business lending

From: Regulatory constraint and small business lending: do innovative peer-to-peer lenders have an advantage?

 

Total small business loan volume

Small business loan for businesses with gross revenues less than $1 million

Small business loan for businesses with gross revenues more than $1 million

 

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

(9)

 

SBLoan

SBLoan

SBLoan

SBLoan1

SBLoan1

SBLoan1

SBLoan2

SBLoan2

SBLoan2

Treated*DFA

− 0.941***

− 0.928***

− 0.586***

− 0.235***

− 0.234***

− 0.033*

− 0.195***

− 0.196***

0.007

 

(− 51.388)

(− 51.543)

(− 32.475)

(− 18.138)

(− 19.054)

(− 1.862)

(− 16.862)

(− 17.862)

(0.425)

Population

0.890***

0.893***

0.895***

0.881***

0.892***

0.892***

0.972***

0.978***

0.978***

 

(56.357)

(54.393)

(53.690)

(53.577)

(50.847)

(50.861)

(66.149)

(64.003)

(63.756)

DebtoIncome

0.005

0.002

− 0.020

0.059***

0.058***

0.050***

− 0.075***

− 0.074***

− 0.082***

 

(0.335)

(0.130)

(− 1.284)

(3.944)

(3.823)

(3.244)

(− 5.973)

(− 5.562)

(− 6.017)

Income

0.613***

0.569***

0.551***

0.430***

0.380***

0.376***

1.110***

1.088***

1.081***

 

(8.181)

(7.389)

(7.015)

(5.305)

(4.569)

(4.498)

(15.434)

(14.688)

(14.511)

Unemployment

0.012*

0.012*

− 0.004

− 0.013**

− 0.014**

− 0.018***

− 0.007

− 0.009

− 0.014**

 

(1.932)

(1.884)

(− 0.672)

(− 2.189)

(− 2.259)

(− 2.944)

(− 1.347)

(− 1.592)

(− 2.376)

BRNUM

0.034***

0.030***

0.021**

0.183***

0.176***

0.169***

0.156***

0.150***

0.144***

 

(4.025)

(3.274)

(2.276)

(20.949)

(18.520)

(17.930)

(19.719)

(18.066)

(17.283)

C3

0.001

0.001

0.001

0.003

0.003

0.003*

0.003*

0.003*

0.004*

 

(0.539)

(0.549)

(0.567)

(1.416)

(1.599)

(1.664)

(1.764)

(1.751)

(1.824)

HHI

− 0.028

− 0.057

− 0.045

− 0.053

− 0.095

− 0.094

− 0.098*

− 0.119**

− 0.118**

 

(− 0.472)

(− 0.953)

(− 0.755)

(− 0.866)

(− 1.520)

(− 1.505)

(− 1.676)

(− 2.037)

(− 2.027)

Domdep

− 0.003

− 0.006*

− 0.003

0.000

− 0.002

− 0.001

0.003

0.001

0.002

 

(− 0.843)

(− 1.856)

(− 0.800)

(0.065)

(− 0.523)

(− 0.285)

(1.084)

(0.287)

(0.542)

County FE

 

Yes

Yes

 

Yes

Yes

 

Yes

Yes

Year FE

  

Yes

  

Yes

  

Yes

Obs

12,183

12,183

12,183

12,173

12,173

12,173

12,183

12,183

12,183

Adj. R2

0.670

0.663

0.681

0.824

0.824

0.827

0.857

0.856

0.859

  1. Table 6 shows the difference-in-differences estimation results in Eq. (1). The variable Treated takes on the value 1 for the counties where there is a bank with $10 billion assets or over affected by the Dodd-Frank Act and there is low competition according to the concentration of the three largest banks (C3) and Herfindahl–Hirschman Index (HHI), which are in the top 75th. If the county has a bank asset below $10 billion, and there is high competition in the bottom 25th, it is defined as a control county and takes 0. Counties other than the 75th and 25th percentile are not included in the model. DFA is the treatment dummy that takes the one from July 2010 onwards and zero prior to that date. There are three dependant variables. SBLoan is the county level total small business loan volume. SBLoan1 is a total small business loan for businesses with gross revenues less than $1 million and SBLoan2 is a total small business loan for businesses with gross revenues of more than $1 million. Standard errors are clustered at the county level and shown in parentheses. Statistical significance at the 10%, 5% and 1% levels is denoted by*,** and ***, respectively.t-statistics are presented in parentheses