Foreign Bank Entry and Entrepreneurship

Research shows that small business creation tends to be an engine for economic growth. Every big business today was once yesterday's small business. To grow successfully, a small business needs access to credit but when a foreign bank enters into a new country, what happens to small businesses' ability to borrow money? The new financial institutions may prefer to deal with more established credit risks and make it difficult for aspiring entrepreneurs to borrow money. Or, they could increase competition and create cheaper access to credit. So what does foreign banking end up doing to lower-income countries as it pertains to development? We talk with Charles Calomiris of Columbia University to see what the effect of foreign banking is on entrepreneurship.

**Stay tuned after the credits for a song Charles recorded with his band Electiontricity about Donald Trump**