US partisan conflict uncertainty and households' access to bank credit: Evidence from UK survey data

Journal Publication ResearchOnline@JCU
Apergis, Nicholas;Cooray, Arusha;Rehman, Mobeen Ur
Arusha Cooray
Abstract

This paper explores how US political uncertainty, stemming from partisan conflict, affects UK households' access to bank credit. Using data from a unique UK survey database and the US news- based Partisan Conflict Index developed by Azzimonti (2018), the findings document that US partisan policy uncertainty negatively affects UK households' access to loans and credit cards. Banks' increased caution on deal selection also appears to be an underlying channel through which partisan political uncertainty can affect lending activities. Further evidence suggests that this partisan uncertainty also increases loan interest rates.

Journal

Global Finance Journal

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Volume

56

ISBN/ISSN

1873-5665

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Pages Count

17

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Publisher

Elsevier BV

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Publish Date

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Date

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EISSN

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DOI

10.1016/j.gfj.2022.100744