Is there a synergetic link among coops? Investigating the relationship between financial and non-financial cooperatives

Using Italian data for the period spanning from 1995 up to 2003, this paper empirically assesses whether a more diffused local presence of cooperative credit banks entails that a larger amount of bank credit is granted to non-financial cooperatives. Besides, the analysis also considers the impact that bank market power and firm opaqueness exert on the amount of credit a firm can obtain. The empirical evidence leads to three main conclusions. Firstly, the financing of cooperative firms does not seem to be favored by credit cooperatives. By contrast, and this is the second finding, a synergetic relationship exists between commercial banks and cooperative firms, as it is from this typology of banks that cooperatives seem to receive more credit. Finally, cooperative firms are less likely to receive bank loans in less competitive local credit markets, even though this impact is decreasing for less opaque firms.