CREAT: Census Research Exploration and Analysis Tool

Home Equity Lending, Credit Constraints and Small Business in the US

October 2020

Working Paper Number:

CES-20-32

Abstract

We use Texas's constitutional amendment in 1997 that expanded the scope of home equity loans as a source of exogenous variation to estimate the effects of relaxing credit constraints on small businesses. We find, using standard panel data methods and restricted-use microdata from the US Census Bureau, that the Texas amendment increased the use of home equity finance by small businesses, increased new business and job creation and reduced establishment exit and job loss. The effects are larger and significant for businesses with fewer than ten employees.

Document Tags and Keywords

Keywords Keywords are automatically generated using KeyBERT, a powerful and innovative keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant keywords.

By analyzing the content of working papers, KeyBERT identifies terms and phrases that capture the essence of the text, highlighting the most significant topics and trends. This approach not only enhances searchability but provides connections that go beyond potentially domain-specific author-defined keywords.
:
disclosure, financial, finance, regulation, lending, loan, borrowing, debt, equity, federal, funding, borrow, census business, credit, collateral, mortgage, subsidized

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:
Characteristics of Business Owners, Bureau of Labor Statistics, Financial, Insurance and Real Estate Industries, Longitudinal Business Database, Economic Census, North American Industry Classification System, Census Bureau Business Register, Census Bureau Disclosure Review Board, Survey of Business Owners, Disclosure Review Board, Business Dynamics Statistics, Federal Statistical Research Data Center

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