Dear statalist,

I am studying the effect of banking competition at the local level on the relationship orientation of banks.

I have been asked to use the variable "relationship banks" as a dependent variable.

Relationship banks are equal to 1 if the bank rated relationship lending as very important while lending to SMEs and zero otherwise. The data for this variable was obtained by interviewing senior credit officers or ceo's at the headquarter level.

Therefore I am not sure how local banking competition could effect relationship orientation at the head quarter level. This is why I didn't use this variable in the first place. I was wondering if my logic is correct.

I would be grateful for your thoughts on this .