Credit ration by control of cognition difference

This paper introduces the cognition difference in the risk of investment projects between banks and enterprises into the model to analyze the relationship between risk cognition difference and the degree of credit rationing. Besides, it simulates the model and the result suggests these two are positively correlated. It is concluded that credit rationing will worsen as risk cognition difference coefficient increases. Thus, an effective way to relieve the credit rationing is to mitigate the different cognitions of risk on projects between banks and enterprises.