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How do inaccurate priors about the distribution of interest rates affect search and outcomes in consumer credit markets? Consumer credit markets feature large amounts of within-borrower price dispersion in interest rates; if consumers are unaware of the extent of this price dispersion, they may shop less and take out loans at higher interest rates than they would otherwise. We conducted a randomized controlled trial with 112,063 loan seekers in Chile where we showed treated participants a price comparison tool that we built using administrative data from Chile’s financial regulator. The tool shows loan seekers a conditional distribution of interest rates based on similar loans obtained recently by similar borrowers, using data on the universe of consumer loans merged with borrower characteristics. We also cross-randomized whether we asked participants their priors about the distribution of interest rates. We find that consumers thought interest rates were lower than they actually were, and the price comparison tool caused them to increase their expectations about the interest rate they would obtain by 56%. Consumers also underestimated price dispersion, and our price comparison tool caused them to increase their estimates of dispersion by 69%. The price comparison tool did not cause people to search or apply at more institutions, but it did cause them to receive 13% more offers and 11% lower interest rates, and to be 28% more likely to negotiate with their lender and 4.7% more likely to take out a loan. In contrast, merely asking participants their expectations about interest rates led them to search at 4% more institutions and obtain 9% lower interest rates.

Native Community Development Financial Institutions (Native CDFIs) have become an increasingly important source of credit and financial services in the areas on or near American Indian reservations in the United States. Guided by a conceptual framework developed on the basis of the related finance literature and drawing on loan‐level data from eleven Native CDFI loan funds, we offer the first systematic quantitative analysis of lending in the Native CDFI industry. As hypothesized, Native CDFIs on average give out small loans but support borrowers in varied circumstances with diverse loan products. Important predictors of delinquency include both conventional, hard information‐based, measures of client risk, and alternative, soft information‐based, community‐informed and character‐based measures. Overall, these findings lend strong support to holistic approaches for assessing client creditworthiness for Native CDFI operations. More generally, our analysis contributes new insights into the operations of an industry that plays an instrumental role in removing barriers to socioeconomic development in Native communities. [ABSTRACT FROM AUTHOR]

This paper examines the impact of three culturally endorsed leadership prototypes on bank lending corruption. We bring together studies that approach the corruption of bank lending officers from the perspective of a principal-agent problem and studies from the leadership literature, suggesting leadership as an alternative to contractual solutions to agency problems. We hypothesize, based on these views, that culturally endorsed leadership styles that improve (worsen) the leader-subordinate relationships have a negative (positive) effect on bank lending corruption. Using a sample of around 3,500 firms from 36 countries, we find that the prosocial leadership prototype and the nonautonomous leadership prototype do not matter, whereas the self-serving leadership prototype has a positive and statistically significant effect on bank lending corruption. These findings are robust to the inclusion of various control variables in the regressions, and alternative estimation approaches, including ones that account for endogeneity concerns. Furthermore, we find that the power of bank regulators and the age of the credit information sharing mechanism play a moderating role in the relationship between the self-serving leadership prototype and bank lending corruption. [ABSTRACT FROM AUTHOR]

Credit is an important component in developing micro, small, and medium enterprises (MSMEs), as it can boost a country’s economy, help boost the production capacity of MSMEs, create jobs, and reduce poverty. This study aims to examine the characteristics of banks in Indonesia that influence lending to micro, small, and medium enterprises by adopting agency theory that explains the relationship between lenders (banks) and borrowers (MSMEs) as agents and principals. Data were taken from quarterly financial reports of banks in Indonesia. There are 42 sample banks from 2010 to 2022, so the data used are 2,182 observations. Data analysis uses a fixed effect model with robust standard errors. The results show that operating costs do not influence credit access for MSMEs or medium-sized enterprises. Bank stability has an impact on increasing MSME credit access. High bank capital also increases MSME credit access. Robustness tests were also conducted using the general method of moments. The results were consistent with the main model. The implication is that cost management theory and credit decision-making need to consider differences in business scale. The results also further strengthen the argument that bank stability is an important factor that can improve access to credit for small and medium enterprises. AcknowledgmentsAppreciation is given to the Doctoral program Universitas Sebelas Maret Surakarta Indonesia and the Institute of Research and Community Services (LPPM) Unisnu Jepara Indonesia, which has supported this research.

The purpose of research. The increasing rate of Russian economy digitalization has ambiguous proportions by industries and regions. Russian regions are characterized by uneven levels of Internet adoption, as well as organizations applying computer networks, servers and electronic documentation systems. This creates territorial differentiation of opportunities for organizations to use digital services and online platforms created by commercial banks to attract and service loans.Overview and analysis of literary sources have led to the conclusion that quantitative assessment of interplay between digitalization of organizations and their credit activity has not been sufficiently developed at the regional level. The purpose of this study is to develop statistical indexes to assess the impact of digitalization of organizations on their credit activity by Russian regions, and to analyze interdependence of suggested indexes to find out the patterns of such an impact.Methods. The source data array is a set of values of statistical indexes, proposed for the purposes of the study, published by Rosstat. This array is processed by imputation of missing values knn – k nearest neighbors to eliminate missing part of the original data. The tightness of statistical relationship between the analyzed variables was assessed by calculating the paired correlation coefficients. The average and median values of the analyzed effective variables were calculated across several years. The regional distribution by clusters per effective variable values was made using the hierarchical cluster analysis. The impact of factor variables on the effective variables was assessed using the panel regression modelling.Results. Based on the system of regional statistics indexes formed by the author, the territorial peculiarities of the dependence of credit capacity on the factors of digitalization of organizations in groups of Russian regions were analyzed, and the parameters of the “response” of credit capacity indexes to changes in individual technological components of digitalization of organizations in regional clusters were obtained.Conclusion. It was concluded that the results of the study could be used to develop business lending programs for commercial banks and determine the priorities of regional digital development programs by government bodies.

We collected over 1600 estimates on the relationship between bank capital and lending and construct 40 variables to capture the context in which these estimates are obtained. Accounting for potential publication bias, we find that a 1 percentage point (pp) increase in capital (regulatory) ratio results in around 0.3 pp increase in annual credit growth, while changes to capital requirements cause a decrease of around 0.7 pp. Using Bayesian and frequentist model averaging, we show that the relationship between bank capital and lending changes over time, reflecting the post‐crisis period of increasingly demanding bank capital regulation and subdued profitability. We also find that the reported estimates of semi‐elasticities are significantly influenced by the empirical approach chosen by researchers. Our findings suggest that the literature fails to provide policymakers with reliable estimates of the effects of capital regulation on bank lending, and our study offers insights that could help guide future research. [ABSTRACT FROM AUTHOR]

China is quickly becoming the largest official lender in the world. For Latin America, China is overtaking multilateral lenders such as the World Bank as the biggest holder of debt in the region. When this is added to the trade relationship with Latin America that has grown rapidly in the twenty first century, initially driven by China's demand for commodities, the linkage between the two now goes even deeper. It further means that a potential stop to Chinese funding due to a domestic financial crisis would have an even more widespread impact on Latin America. This paper analyses China's overseas lending strategy and how it has deepened the relationship with Latin America. It then turns to the potential of a Chinese financial crisis and the significant implications for the Latin American region. The article concludes with policy recommendations. [ABSTRACT FROM AUTHOR]

We examine the nonlinear relationship between interest rates on bank risk-taking behavior in South Africa between 2008:q1 and 2022:q3 using nonlinear autoregressive distributive lag (NARDL) and quantile autoregressive distributive lag (QARDL) models. Whilst the preliminary estimates from linear ARDL produce results adhering to conventional theory, the NARDL and QARDL analysis shows that the relationship between the variables is more complex. On one hand, the NARDL model shows that the phase of monetary policy (cyclical asymmetries) is important in determining the pass-through effects of interest rates on bank risk behavior. We find that both contractionary and expansionary monetary policy increases long-term risk through decreased liquidity for the former and increased non-performing loans for the latter. On the other hand, the QARDL model shows that the level of bank risk behavior (location asymmetries) is also important in determining the impact of interest rates on bank risk behavior. We find that interest rates affect bank risk behavior in 'medium-to-high risk environments' for unsecured loans and lending and in 'medium-to-low risk environments' for liquidity. Overall, these results enable us to recommend ways in which the SARB can strengthen its monitoring mechanisms given the multifaceted impact of interest rates on bank risk-taking. [ABSTRACT FROM AUTHOR]

This paper investigates the importance and the determinants of trust in a lending situation using a controlled experiment. We find that communication can facilitate collaboration between lenders and borrowers through three channels of trust: (1) an information channel, (2) a preference channel, and (3) a reciprocity channel. Our results highlight the role of trust in mitigating the moral hazard problem in lending. [ABSTRACT FROM AUTHOR]

The article examines the financial and credit infrastructure of agriculture and the credit mechanism as elements of the financial and credit systems of the state. The institutional and functional structures of the financial and credit infrastructure of agriculture are analyzed. The trends, problems and features of the formation and functioning of the credit mechanism of the agro-industrial complex are considered. Recommendations for improving the credit mechanism of the agro-industrial complex have been formulated. Methodical approaches to forms of agribusiness lending are proposed and a description of certain types of lending, most acceptable for enterprises in agriculture, is given. The need for the formation of special lending mechanisms for agricultural production enterprises, adapted to the specifics of the industry, has been proven. [ABSTRACT FROM AUTHOR]

The aim of the article is to study the features of the impact of monetary policy on the domestic labor market during the wartime. The main trends in the labor market of Ukraine both before the full-scale invasion of the russian federation and under martial law are determined. The indicators of official statistics on the number of unemployed are studied, assumptions about the real level of this indicator are made, and short-term trends in the revival of registration of persons in the employment center as unemployed or job seekers are predicted. The impact of the bank rate policy pursued by the central bank on employment of the population has been proved. It is determined that the overall impact of changes in the bank rate in the country depends on the ratio between small and large enterprises, as well as on the share of employees with high and low levels of education. Reserve requirements for banking institutions are mentioned as a monetary instrument for influencing the labor market. It is emphasized that one of the main obstacles to doing business in wartime is the lack of working capital. It is calculated that in the structure of loans granted by the banks of Ukraine, the dominant value (more than 70%) belongs to economic entities. Considerable attention is paid to business lending (including within the framework of the state program «Affordable Loans at 5-7-9%») as a prerequisite for the creation of new jobs. The problems of growth in the volume of non-performing loans during the wartime are considered. The catastrophic position of Ukraine in the ranking of countries by the level of NPLs in the total volume of loans issued, compiled according to the World Bank data, is underlined. The trends in the level of NPLs in Ukraine before the full-scale invasion and the reasons for the growth in the volume of non-performing loans in 2022–2023 are analyzed. It is proved that the high cost of credit resources limits the availability of working capital in business and forces it to optimize wage costs, which leads to a decrease in the level of remuneration and reduction of jobs. It is substantiated that the monetary aspects of the influence on the preservation of the labor potential of the nation acquire special importance during the war.

Introduction. The changes in the economic situation, which happened after certain events of February 2022, required signifi cant investment in the development of small and medium-sized businesses. Parallel imports, new market niches to be fulfi lled after foreign producers had left, the desire to preserve and increase capital while experiencing ruble devaluation– these and other reasons formed the basis of crowdlending studying in this paper. Theoretical analysis. The growth rates of the crowdlending market in Russia are analyzed and the dynamics of crowdlending and bank loans to small and medium-sized businesses are compared. Empirical analysis. Based on the example of the company “JetLend” LLC, an analysis of the requirements for borrowers and investors, the stages of potential borrowers’ business checking were carried out. A comparative characteristic of the JetLend, IFX Cbond, Cbonds-CBI RU High Yield indices is presented, which suggests that during 3 years, an average investor of the JetLend platform had a higher yield than if he owned a portfolio of high-yield bonds or bonds of the most liquid companies in Russia. Results. Positive and negative aspects of using crowdlending for both investors and borrowers are summed up. It is concluded that crowdlending is a promising tool for small and medium-sized businesses, especially for those economic entities which do not have collateral, credit history or other factors necessary for a bank loan.

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Six studies explore the psychology of borrowing and lending. Across two different contexts—friends lending to friends and taxpayers bailing out businesses—lenders are angrier with borrowers who specifically make hedonic (as opposed to utilitarian) purchases with loaned money. This anger is pronounced enough that lenders' negative feelings toward borrowers who made past hedonic (vs. utilitarian) purchases remains even after they have been fully repaid. Undergirding lender anger is deserved oversight—a novel construct capturing people's belief that they deserve control and say over another's decision‐making. Borrowers and lenders do not agree on who deserves oversight over how the loaned funds are spent in large part because they differ in how much perceived ownership they each feel over the money. When lenders are yet to be repaid, their desire for oversight extends even to purchases made separately from the loaned amount. Finally, these processes and consequences are most powerful when money is lent compared with other forms of exchange, such as gifting money or being paid for work. [ABSTRACT FROM AUTHOR]

We investigate the effectiveness of the euro area's single supervisory mechanism's capital relief measures in response to the outbreak of the coronavirus pandemic, in terms of large non-financial corporations' lending outcomes. Using a granular borrower level dataset and controlling for the policies of other euro area authorities, bank characteristics and demand effects, we find that the lifting of the pillar 2 guidance (P2G) capital recommendation had a considerable statistically significant impact in supporting bank credit supply. The results are attributed to both, the capital made available and announcement effects. The latter are generated by the communication of supervisory plans and the fact the P2G was not designed to be ex ante "releasable". The announcement of granted supervisory flexibility seems to have reduced uncertainty surrounding forthcoming regulatory responses in the beginning of the pandemic and acted as a de facto "supervisory forward guidance" in support of bank business decisions. Going forward we propose the creation of a formal supervisory forward guidance strategy, to complement the existing communication channels, to the benefit of banks' and market participants' decision making during both normal and crisis times. Our work therefore contributes to the literature threefold: (i) it introduces a novel granular supervisory dataset at the borrower level, (ii) it is one of the first papers to take a euro area supervisory perspective in analysing the effectiveness of capital relief measures at the onset of the Covid-19 pandemic, and (iii) it proposes a new supervisory policy instrument, the "supervisory forward guidance" with the goal of informing and steering banks' and market participants' expectations in order to prevent distress episodes. [ABSTRACT FROM AUTHOR]

We investigate whether European banks adjust their loan prices and volumes of new lending in the months running up to major national elections. Using a unique dataset that draws on data covering some 250 banks in 19 Eurozone countries from 2010 to 2020 at monthly frequency, and that includes lending amounts and interest rates on new lending, we find that European banks increase loan rates for corporate and housing loans ahead of elections. This supports the view that loan pricing changes of European banks are driven by the electoral uncertainty inherent to the democratic election process. We find that the impact of elections is more pronounced for small banks, as well as obtain some evidence that elections affect the credit supply of banks. Our findings suggest that the occurrence of elections is affecting the behavior of European banks. [ABSTRACT FROM AUTHOR]

This study examines whether, and to what extent, SFAS166/167 changed the role of securitization in bank liquidity and lending activities. We compare the sensitivity of on-balance sheet loan growth to the loan portfolio liquidity index proposed by Loutskina [(2011) The role of securitization in bank liquidity and funding management, Journal of Financial Economics 100, 663–684] between affected banks and control banks. We find that SFAS166/167 is significantly associated with a reduction in the use of securitization to enhance on-balance sheet liquidity, consistent with the view that consolidation on balance sheets may render the securitization of loans too costly to be considered an effective source of liquidity. In addition, we find that affected banks with the highest increase in liabilities from consolidating Qualified Special Purpose Entities (QSPEs) experienced a significant decrease in lending activities relative to the control banks. This is likely because consolidating former QSPEs may adversely affect the ability and willingness of banks to engage in securitization and issue new loans. Taken together, our results suggest that SFAS166/167, requiring the consolidation of former QSPEs, led to a decline in the role of securitization as a liquidity management tool in banks and to a significant decline in lending.

Assessing the effectiveness of the inflation targeting framework via the interest rate channel remains crucial in the current monetary policy debate. For Ukraine, the relevance of this discussion is enhanced by the adoption by the National Bank of a rigid inflation targeting policy since 2016, as well as by the challenges of price stability during war. The aim of the study is to identify how the discount rate affects the money market rates and how this affects inflation in Ukraine. Employing a VAR model on monthly data spanning 2016 – Q1 2022, the analysis demonstrates weak empirical evidence for the interest rate channel effectiveness. The impulse response indicates that the discount rate’s initial effect does not provide long-term inflation dynamics control. Variance decomposition analysis highlights the minimal influence of the NBU’s discount rate, primarily evident in the refinancing rate, followed by its impact on the rate of term deposits made by individuals, followed by the inflation, followed by the rate of new loans granted to residents, and finally the rate of government bond yields. Addressing the limitations of a rigid inflation targeting approach, the study recommends adopting a balanced approach, considering both price stability supported by exchange rate control measures and fostering economic growth. Additionally, a viable strategy for deepening the financial sector should be developed.

Technological innovation in the field of finance requires in-depth study of both technology and law. To contribute to this field, this paper proposes to analyse crowdlending, a procedure that allows the conclusion of loan agreements in which intermediaries disappear and online platforms participate. This procedure presents numerous legal challenges to which we must respond, and response requires analysing our legal foundations. As everythi ng has its precedent, meeting the legal challenges of regulating crowdlending requires study of its antecedents and, thus, analysis of the loan agreement. We have found as a legal precedent the contract of mutual (mutuum) of the Roman Law because this system configures the loan contract also without intermediaries. We studied it to check the problems it raised and what were its solutions. This is the starting point to face the analysis of crowdlending.

Startup businesses are becoming an increasingly common term in the business world. Millions of investments, large corporations, as well as the world's best experts are connected to the concept of startup businesses. The basis of this paper is to present the situation with lending startup businesses in the Republic of North Macedonia, through analysis of the situation and challenges of the startup ecosystem in the country, and through comparative analysis of the situation with lending startup businesses in certain Western Balkan countries. The aim was to determine whether the Republic of North Macedonia has made significant progress in support, and whether it has made the transition from traditional to new methods of financing. The scientific-research contribution of this paper is in a better understanding of the strategy of the state regarding the financing of entrepreneurial ventures. The presented and interpreted results could be a useful basis and incentive for further research on this and similar topics related to the initial stage at the state and regional level. [ABSTRACT FROM AUTHOR]

It has been updated that in conditions of limited own financial resources, foreign capital plays the role of a driver of the growth of the entrepreneurial sector and an important source of meeting the significant investment needs of the Ukrainian economy. Based on the analysis of the volume and structure of the credit portfolio, it was determined that during 2021-2023 credit activity lost the leading role among the active operations of banks with foreign capital in Ukraine. It was emphasized that the strengthening of the threat of additional credit risks led to a change in priorities in the work of banks in the direction of investing in securities. It was noted that the banks belonging to foreign banking groups were cautious in lending to the real sector of the economy and showed disinterest in the growth of the credit portfolio, they managed to get high profits due to the increase in the value of loans. It is substantiated that banks with foreign capital in Ukraine implemented a conservative or passive credit strategy. It is emphasized that banks with foreign capital in Ukraine may lose one of the main functions of financial intermediation - lending to business entities and citizens. It was concluded that in order to increase efficiency and ensure long-term credit relations between economic entities, it is necessary for the state to create conditions for the activation of real production, employment of the population and stimulation of banks to form a balanced structure of assets. The directions for improving the State Program for the Development of Lending to Business Entities are outlined, including: compliance with the long-term and investment nature of lending, development of appropriate socio-economic criteria for assessing the achievement of investment goals, ensuring equal competitive conditions for representative banks of various banking groups for attracting clients to the Program. Emphasis is placed on the need to avoid increasing complexity when applying a loan application for potential borrowers due to the inclusion of ESG components in it in accordance with the policy of the National Bank of Ukraine regarding the development of sustainable financing. [ABSTRACT FROM AUTHOR]

In the context of escalating military and political uncertainties, a crucial component of banking system stability is the establishment of an adequate level of resource provision – liquidity. The research aims to analyze the transmission impact of the banking system's liquidity and its structure on the volumes of financing for the real sector of the economy in the second year of the war in Ukraine. In the conditions of war and the corresponding intensification of military-political threats and uncertainties, the regulator has made numerous complex decisions and restrictions aimed at balancing the challenges with the current situation in financial markets. The research found that the banking sector of Ukraine currently accumulates a significant amount of excess liquidity and demonstrates high profitability. However, in the conditions of war, the transmission mechanism works improperly, requiring constant intervention from the regulator to balance the liquidity of the banking sector and state finances, which, in turn, affects the behavior of commercial banks and changes the structure of their asset portfolios. An analysis of the structure of active operations portfolios of the banking, corporate, and private sectors provide grounds to assert that there is no reason to expect a change in investment behavior from these groups in the perspective of the next year due to the specificity of the conditions imposed by the Ministry of Finance and the regulator. To maintain macroeconomic stability in the national economy in the conditions of martial law it is necessary to introduce conditions to reduce demand for foreign currency and, as an alternative, offer the preservation of savings solvency through simplifying access to investments in government securities for households. The low financial literacy of the population and the underdeveloped stock market in Ukraine, as well as the more complex mechanism of purchasing government bonds or military bonds compared to deposit services, make such investments by the population insignificant and limited in demand. [ABSTRACT FROM AUTHOR]

The aim of the article is to study the features of the impact of monetary policy on the domestic labor market during the wartime. The main trends in the labor market of Ukraine both before the full-scale invasion of the russian federation and under martial law are determined. The indicators of official statistics on the number of unemployed are studied, assumptions about the real level of this indicator are made, and short-term trends in the revival of registration of persons in the employment center as unemployed or job seekers are predicted. The impact of the bank rate policy pursued by the central bank on employment of the population has been proved. It is determined that the overall impact of changes in the bank rate in the country depends on the ratio between small and large enterprises, as well as on the share of employees with high and low levels of education. Reserve requirements for banking institutions are mentioned as a monetary instrument for influencing the labor market. It is emphasized that one of the main obstacles to doing business in wartime is the lack of working capital. It is calculated that in the structure of loans granted by the banks of Ukraine, the dominant value (more than 70%) belongs to economic entities. Considerable attention is paid to business lending (including within the framework of the state program «Affordable Loans at 5-7-9%») as a prerequisite for the creation of new jobs. The problems of growth in the volume of non-performing loans during the wartime are considered. The catastrophic position of Ukraine in the ranking of countries by the level of NPLs in the total volume of loans issued, compiled according to the World Bank data, is underlined. The trends in the level of NPLs in Ukraine before the full-scale invasion and the reasons for the growth in the volume of non-performing loans in 2022–2023 are analyzed. It is proved that the high cost of credit resources limits the availability of working capital in business and forces it to optimize wage costs, which leads to a decrease in the level of remuneration and reduction of jobs. It is substantiated that the monetary aspects of the influence on the preservation of the labor potential of the nation acquire special importance during the war. [ABSTRACT FROM AUTHOR]

In this article, the importance of modern forms of Ukraine’s cooperation with international financial institutions (IFSs) is discussed. The author systematised IFIs by classification criteria and looked into the main forms of financial cooperation between the government of Ukraine and IFIs. The analysis indicates that in today’s global economic system, the most common form of cooperation between governments and IFIs lies in lending. The structural and dynamic analysis of the forms of financial assistance from IFIs to Ukraine also confirmed this. The analysis of the cooperation between the Ukrainian government and IFIs also confirmed that loans from IFIs are the main source of long-term financing for socio-economic development projects in Ukraine’s priority sectors. Additionally, the author analyses the aspects of Ukraine’s cooperation with the IMF, the World Bank Group, and the IBRD, and identifies the areas of use of credit and investment resources in 2020- 2023. Hence, the borrowed credit resources received by Ukraine from the IMF are used to service external debt, finance the budget deficit and deficits in the balance of payments and trade. In times of crisis for Ukraine’s economy, the IMF’s loans help replenish the NBU’s foreign exchange reserves, maintain the stability of the national currency, and optimize the monetary policy of the National Bank of Ukraine which stimulates lending to the real economy. Ukraine used the loan resources from the IFIs of the World Bank Group to cover the budget deficit, to implement institutional and structural reforms as well as long-term investment projects. The author also defines the importance and role of international technical assistance in the framework of Ukraine’s cooperation with IFIs, proving that international technical assistance is provided to Ukraine on a free and non-refundable basis by donor countries and international institutions. In conclusion, the author underlines the expected risks and necessity of this cooperation. [ABSTRACT FROM AUTHOR]

This special issue brings together the papers presented and discussed at the Harold A. Black Academic Conference hosted by the Probasco Distinguished Chair of Free Enterprise at the University of Tennessee, Chattanooga, the Haslam College of Business at the University of Tennessee, Knoxville, and the Political Economy Research Institute at Middle Tennessee State University. Dr. Black is an emeritus professor of finance at the Haslam College of Business at the University of Tennessee, Knoxville, and has had a distinguished career advancing our understanding of race and discrimination in banking and finance. More specifically, throughout his career, Dr. Black undertook in-depth empirical studies that examined the institutional details of statistically observed disparate outcomes in banking and finance to determine whether these outcomes were attributable to discrimination or could be explained by non-discriminatory factors. In some instances, Dr. Black found that addressing disparate outcomes with inappropriate policies could result in perverse consequences that harmed the intended beneficiaries. This introduction explores the relationship between Harold Black's work, the papers in this special issue examining, building on, and extending Harold Black's work, and public choice economics. [ABSTRACT FROM AUTHOR]