Discriminatory Lending: Evidence from Bankers in the Lab

We implement a lab-in-the-field experiment with 334 Turkish loan officers to document gender discrimination in small business lending and unpack mechanisms. Officers review multiple real-life applications which we randomize applicant gender. While unconditional approval rates are the same, 26 percent more likely require guarantor when present same application as coming from female instead of male entrepreneur. A causal forest algorithm estimate heterogeneous treatment effects reveals that is concentrated among young, inexperienced, gender-biased officers. Discrimination mainly affects applicants male-dominated industries, indicating how financial frictions can perpetuate entrepreneurial segregation across sectors. (JEL C93, G21, G32, J16, L25, L26, O16)