Olga Gorbachev

"Do Bank Branches Still Matter for Local Economic Activity?"

ABSTRACT:

An extensive literature documents that physical bank branches are still important for credit access, especially in information-intensive environments. This observation is surprising and potentially concerning given the advancement of information technology that pushed (and is continuing to push) many bank services onto online platforms leading to branch closures. The move to close physical branches might have important implications for local economic activity. Previous work documents that areas with branch closures see reductions in small business lending and to a smaller extent mortgage originations.