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This chapter examines how deregulatory fiscal policies undermined federal legislation intended to reduce racial and economic inequality through measures that included wider access to home loans among minority populations. We focus specifically on structural tensions that existed between fostering the goals of economic and racial equality within a political structure that also serves the needs of finance capitalism. The Community Reinvestment Act (CRA), typically considered a triggering point for the financial meltdown by conservative commentators, was passed to address racial and economic inequalities, yet financial deregulation and the growth of the subprime mortgage industry ended up completely subverting these goals. The unprecedented growth and evolution of the subprime mortgage industry that occurred largely outside of the law's reach helped minorities and other economically disadvantaged groups enter into the housing market. However, a crime-facilitative environment brought on by inadequate regulation resulted in a significant degree of fraud by lenders. While this expanded homeownership among minorities, it eventually pushed them into default and brought chaos to the entire U.S. economy. This chapter details how the collapse of the subprime industry disproportionately impacted minority populations, and exposes how deregulatory policies subverted the effectiveness and reach of the FHA and CRA. The history of the CRA provides a clear example of the contradictory tensions within the U.S. legal system that espouses equality yet ultimately fails those it was designed to help as a consequence of unfettered capitalism.

Recently bankers have come to realise that banking operations, especially corporate lending, affect and are affected by the natural environment and that consequently the banks might have an important role to play in helping to raise environmental standards. Although the environment presents significant risks to banks, in particular environmental credit risk, it also perhaps presents profitable opportunities. Stricter environmental regulations have forced companies to invest in environmentally friendly technologies and pollution control measures and in turn generated lending opportunities for bankers. This article examines the lending policies of a sample of UK banks with respect to the environment, focusing on issues of environmental risk management, market segmentation and the exploitation of marketing opportunities. The research found that while the banks are placing considerable emphasis on environmental risk management in their corporate lending operations, there is little evidence of them harnessing the opportunities presented by the “greening” of industry.

This paper examines the effect of bank expansion on credit access and terms of credit in early America. The bank records from Plymouth Bank, Massachusetts and the Census records provide detailed information on borrowers, endorser, types and terms of loans, and borrower characteristics. The results show that the introduction of new banks did broaden credit access. However, after competition was introduced, the Bank focused more on short-term bills of exchange. In other words, the Bank shifted its emphasis from long-term accommodation paper to short-term bills of exchange.

The role of debt in episodes of financial stability is a topic of increasing important as the global economy struggles to recover from the worst crisis since the Great Depression of the 1930s. The purpose of this paper is to examine the mortgage finance booms of the 1920s and 2000s as natural experiments, new insights into debt-driven financial crises are gained.

The general methodology is interpreting anomalous historical events as natural experiments. The specific methodology is the approach to natural experiments provided by Joseph A. Schumpeter and Milton Friedman. The hypothesis tested is that laxity in lending standards was the prime contributor to the mortgage debt booms. In each case, we explain why factors other than laxity in lending standards would be secondary factors, with the pre-boom and post-boom lending standards providing the control groups of natural experiments. The two episodes of mortgage debt booms occurring under very different general economic and financial conditions provide an especially strong test of the hypothesized functional relationship.

The results of the two natural experiments support the hypothesis that lax lending standards were the prime contributors to the two episodes of debt-driven financial crisis.

From a social economics perspective, the insights gained are important because a major social goal has been to encourage greater opportunities for home ownership. The results of these natural experiments provide guidance for policymakers in the search for a viable balance between achieving that social goal and maintaining financial stability.

Directors help determine the strategic direction of a corporation and are responsible for ensuring the institution has a good system of internal control. Banking institutions without a strategic direction emphasizing sound lending practices that promote the long-run financial health and viability of the institution will be sued more frequently than peer institutions. Institutions that do not have a good system of internal control will also be sued more frequently. Hence, legal expense is a bank corporate governance measure. We compare the performance of bank legal expense and a widely cited corporate governance index in a regression framework to determine which better predicts bank performance. The regressions indicate legal expense is a much better predictor, hence a better measure of bank corporate governance. Regulators should require legal expense reporting and rank institutions by the ratio of legal expense to assets to help identify institutions with weak governance. Seven case studies illustrate the role of legal expense in corporate governance.

This paper aims to explore the consumer insights and ethical concerns surrounding the online payday loan services available in the Google Play Store. This research was conducted to compare whether the presence or absence of debt collection protection acts in a country creates differences in consumer experiences regarding the ethics of payday loan collection. Specifically, the study compares customers’ experiences in both the Indonesian and US markets.

Indonesia and the USA were chosen because they have very different regulatory structures for the payday loan industry. The data was scraped using Python from 27 payday loan apps on the Indonesian Play Store, resulting in a total of 244,697 reviews extracted from the Indonesian market. For the US market, 446,010 reviews were extracted from 14 payday loan apps. The data was further analyzed using NVIVO.

The results suggest that consumers of payday loans in Indonesia and the USA hold positive views about the benefits of payday loan apps, as revealed by the word frequency and word cloud analysis. Notably, customers in both countries did not express any negative sentiments regarding the unethical interest rate charged by the payday loan, contradicting what is commonly reported in academic literature. However, a distinct pattern of unethical conduct was observed in both countries concerning marketing communication and debt collection practices. In the Indonesian market, payday loan companies were found to engage in unethical debt collection activities. In the US market, payday lenders exhibited unethical behavior in their marketing communication, particularly through deceptive advertising that makes promises to consumers that are not delivered.

The study aims to provide evidence on the various experiences of customers in the presence and absence of debt collection regulations using a novel methodology and a large sample, which strengthens the results and conclusions of the study. The study also intends to inform policymakers, particularly the Indonesian government, about the need for specific laws to regulate the debt collection process and prevent unethical practices. Ultimately, the study is expected to protect the rights of consumers from a deceptive marketing communication or unethical debt collection practices in both the Indonesian and US markets.

This study aims to investigate whether lending to women decreases sustainability of microfinance institutions (MFIs) and how regional characteristics where MFIs are located moderate this effect.

Financial and operating data of MFIs and national cultures are available from the MIX Market database and the Hofstede’s publications. These data are analyzed by using multiple regression models with the financial self-sustainability, proportion of women borrowers in the MFI’s lending portfolio, and dimensions of national culture as dependent, explanatory and moderating variables.

Lending to women tends to reduce sustainability of MFIs. This negative effect is more pronounced in countries ranking higher on power distance and individualism, but the effect is less serious in countries ranking higher on masculinity and uncertainty avoidance.

Many studies demonstrate that MFIs improve their repayment rates by targeting women borrowers. The increase in repayment rates, however, may not always improve their sustainability. Further, as microfinance industry increasingly diversifies geographically, regional characteristics where MFIs are located play a vital contingent role in their sustainability.

The purpose of this paper is to explore the effect of monetary policy on the lending behaviour of commercial banks in Zambia using bank-level data.

Dynamic panel data econometric analysis is used to uncover the evidence of monetary transmission mechanism in Zambian banking industry. Other specifications are used as robustness checks.

Contrary to received evidence, the authors find that the bank lending channel in Zambia operates mainly through large banks. The effect of monetary policy on medium-sized banks is moderate while it is virtually non-existent for smaller banks. Furthermore, the data does not show evidence of relationship lending for smaller banks.

Overall, the findings of this investigation suggest that price signals, rather than quantity aggregates, matter the most in the transmission of monetary policy in Zambia. The results therefore lend support to the central bank’s recent shift in monetary policy framework from using monetary aggregates to interest rate targeting as a means to strengthen effectiveness of monetary policy.

This paper aims to summarise the changing pattern of Australian interlibrary loans and document delivery, the achievements of the consultative mechanisms (National Resource Sharing Working Group and National Research Sharing Policy Committees) and issues identified for further action.

Looks at the different aspects of resource sharing.

The major themes identified for future action are the need for increased resource discovery (through the NBD), acquisition of collections (particularly with library closures), capability building (training and manuals), information on performance and an urgent need to review the ILRS Code to improve speed of delivery and intelligibility of service levels.

From the user perspective, the ILL/DD system in the early twenty‐first century is complex and fragmented. The challenge for the Australian library sector is to build on the good infrastructure and systems developed through the NRSWG and NRSPC over the past six years and to develop new models which provide easy transparent modes of access to library collections across the nation.

Alternative enterprises – organizations that operate as a business while still also being driven by a social purpose – are sometimes owned by workers or other stakeholders, rather than shareholders. What role does ownership play in enabling alternative enterprises to prioritize substantively rational organizational values, like environmental sustainability and social equity, over instrumentally rational ones, like profit maximization? We situate this question at the intersection of research on: (1) stakeholder governance and mission drift in both hybrid and collectivist-democratic organizations; and (2) varieties of ownership of enterprise. Though these literatures suggest that ownership affects the ability of alternative enterprises to maintain their social missions, the precise nature of this relationship remains under-theorized. Using the case of a global, social, and environmental values-based banking network, we suggest that alternative ownership is likely a necessary, but not sufficient, condition to combat mission drift in enterprises that have a legal owner. A supermajority of this network’s banks deploy alternative ownership structures; those operating with these structures are disproportionately associated with social movements, which imprint their values onto the banks. We show how alternative ownership acts through specific mechanisms to sustain enterprises’ missions, and we also trace how many of these mechanisms are endogenous to alternative ownership models. Finally, we find that ownership models vary in how well they enable the expression and maintenance of these social values. A ladder of mission-sustaining ownership models exists, whereby the dominance of substantive, non-instrumental values over operations and investment becomes increasingly robust as one moves up the rungs from mission-driven investor ownership to special shareholder and member-ownership models.