The second statement is the Commission’s Learn from the costs and you can Great things about different Rules Solutions for Financial Borrowing from the bank (Western european Percentage, 2009, come across particularly Annex B: Legal Descriptions)

To evaluate our very own head theory the to very early fees increase the speed pass on amongst the banks’ credit speed and lending cost within the an even more specialized trends, i first built a customer shelter index. The new index classifies nations with regards to the sort of compensation, or no, one users must pay on their lenders if they want to pay back its mortgage loans until the contractual deadline. Our categorical index adjustable ranges in the low quantity of consumer safeguards To-be discussed = 0 to your high number of individual defense Totally free = 2.

Here we questioned this new central banking institutions, ministries out of finance of your Member States and you will lender otherwise user security associations about the appropriate level of user cover inside their respective places

Our very own directory categorizes the brand new laws governing very early payment throughout Eu Member Claims anywhere between 2006 and you may 2016 on thirty day period-to-week foundation. To get information regarding what laws governed early payments where era from inside the a given country, i mark out of numerous offer. A study used of the Eu Commission within its energy so you’re able to harmonize the brand new European financial places, gained more information for the national mortgage , get a hold of especially pages 5581). Using this investigation i have drawn details about the court regimes governing very early costs on European union Member Says inside the 2006. This study accumulated data on degrees of consumer security for untimely repayments in 2009. However, each other records have generally qualitative details about the newest national cover accounts. We therefore arranged our personal category scheme to quantify this type of analysis and you can accompanied a dual-blind programming procedure. Eventually, from inside the 2016 we held an elizabeth-mail survey to collect our own number one studies. The user security index you to definitely lead from our class exercising is exhibited in the Table cuatro, less than.

Considering our very own User Safety Directory we authored one or two in a different way coded explanatory parameters. These types of variables were used in our very own mathematical patterns to check the brand new theory more stringent individual protection laws results in highest interest rates advances involving the banks’ credit costs and you may financing rates. The first, chief variable ‘s the User Cover getting Early Installment (Dummy) adjustable. Because indicated of the the term, this changeable try a good dummy one requirements the first category of our directory Payment to your financial have to be negotiated otherwise injuries need to be paid as the 0 and all most other categories, i.elizabeth. Responsibility cover otherwise lender’s even more management expenses simply and you will Totally free because the step one. The explanation behind it programming is the fact that resource group signifies the individuals places and this use the latest default code utilized in offer laws having a breach out-of a customer financial offer. Brand new variable codes since 1 all of the nations one diverge using this default rule and you will rather prescribe a top loans No Name necessary protection height to own individual financial agreements. It dummy are therefore an old-fashioned and you can legitimate way of measuring the consumer defense accounts getting early money about some other Associate Says. I utilize the dummy varying within head analytical activities, as we consider it to get the most appropriate level so you’re able to try the lookup theory.

All of our second adjustable ‘s the Consumer Coverage having Early Payment (Categorical) variable. Which categorical variable has the exact same programming given that user safety index put above. When compared to the dummy varying, it is the so much more finely grained and you can complex level. Off a legal viewpoint, this new varying may be smaller reputable, if we thought that the multilinguistic, multijurisdictional environment of one’s European union produced the newest comparative law efforts on which the brand new programming depends a challenging task. Also, the fresh new variety of findings for each category are shorter healthy compared to brand new dummy variable. I thus make use of this changeable for a standard robustness shot. Nevertheless, the outcome that people acquired that have both details is consistent with both.