201 5.5.2 Independent Variable To measure creditor protection in US states we use the Creditor Friendliness Score constructed by Ghent (2014). The Creditor Friendliness Score is our key it nh de eepxet en nd te tnot wv ahriicahb lset at therso’ uc guhr or eunt taml l or er tggrae gs es i loanwms iond tehl se. UG Sh eanr te’ sc rs ec do irteo rmfer ai esnudr el ys. The classification is based on the laws applicable to residential loans that wdiemreenisssiounesd in 2010 or later. The score ranges from 0 to 1 and is based on the 62 that are explained in section 5.2.2. Points are awarded as follows bo fy j Gu dh iecni at :l f2o rf eo cr l ot hs ue r feo rpercolcoesduur er e ps raoncde dmu ri ne i mu sael dr, e 1s t rf oi crt i cornesd, i2t opr -of irni et sn df ol yr sf ot ar mt e ss pc reerdmi tiot tri-nf rgi epnodwl ye rs-toaft-es arleeg ifmo reesc laons du r ae ss. cAo r sec oo fr e0 of fo r4 t hi se al sesaisgtncerde df oi tro rt-hf rei emn do sl yt lraewposr(tGehdeinnt, 2014). We link this score to the underlying collateral information as Bloomberg. The collateral information only reports the state in which tshoewmea lj ionrki t yt hoef tthr ae nt cr ahne cwh ei t’ sh ctohl el a tset ar at el i isnl owc ahtiec dh (teh. eg . ,m6 a0j%o r li ot yc aot fe di t si ncCoal llai ftoerrna il ai)s, located. Our study is unique as the majority of empirical studies63 that investigate creditor ruipg dh at st euds ve etrhsei ocnr eodf iDt oj ar nrki gohvt es ti na ld. e( x2 0c 0o 7n )s ,t rt hu ac tt eeds tbi my aLtae Pt ho re t car ee td iatlo. r( 1p9r o9 t7e)c, toi or nt hoef a specific country but do not differentiate between country regions. Hence, these indices do not allow us to compare in-country differences between US states abse tewaecehnc coouunnt rt ryyr reecgeiiov enss o( en. lgy. , ot hnee Uc rneidt ei tdo rS tpart oe st ercet ci oeni v es cdoar ec rwe idt iht oo ur tpdr oe tvei ac tt ii onng score for the whole country only, no division between states has been made). 62o f -Tshael ef ifvoer edci lmo seunrsei ovnesr saur es j(ui )dliicei na l t fhoeroe rcyl ovseurrseu, s( itvi t) l leo- nt hgeeor rsyt as tt ua tt eo ,r (yi/i )e mq uoi rt at gbal eg er evde er smups tdi oe ne dr iogfhttrsu, sa tn, d( i (i iv) )t dh ee fpi coi we necry- judgement permitted. 63 See, for example, Qian and Strahan (2007), Bae and Goyal (2009), and Cho et al. (2014). Chapter 5 - The Impact of Creditor Protection
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