Discrimination in bank lending

The relationship between discrimination in bank lending for business purposes and discrimination in lending generally is interlocking to the extent that an assessment of one aspect of discrimination in lending cannot proceed effectively without addressing the other half of the discrimination in lending equation (Garsson, 1994, pp. 1-2). Further, any investigation of discrimination in lending based on socioeconomic status cannot be divorced from discrimination based on ethnicity, race, and gender because of the strong ties among the four variables in relation to accessibility to credit (Seiberg, 1995, pp. 1-2).

Thus, while the primary focus of this study is on discrimination in business lending to low-income persons, issues of discrimination in lending for purposes other than busines

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competitors in their region also practice discrimination. In the latter context, it is also necessary for the competitors to have, essentially, the same taste for discrimination; that is, all must be willing to pay the same price to be able to discriminate. Becker (p. 18) does not think that the HMDA data necessarily provide evidence of discrimination in mortgage lending. Becker (p. 18) bases his contention on his theory of discrimination in the market place. This theory demands that discriminators sacrifice profits in order to discriminate against a particular population group. First, Becker (p. 18) contends that the HMDA data provide no basis for making such an assessment because default rates, late payments, interest rates, and other determinants of profitability for various racial and ethnic groups are not measured. Second, if discrimination in mortgage lending were occurring, mortgage bankers would lend to only the most credit worthy minority applicants, thereby causing minority mortgage lending to be more profitable than mortgage lending to whites. The study of mortgage lending in the Boston metropolitan area conducted by the Federal Reserve Bank of Boston where default rates were collected, however, found no differ
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Some common words found in the essay are:
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Approximate Word count = 5063
Approximate Pages = 20 (250 words per page)

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