Using the Austrian Business Survey between 2011 and 2016, we study how firms' individual credit market experiences influence
their beliefs about the bank lending policy. Firms that have recently experienced a loan rejection are more likely to believe
that the lending policy is restrictive. We see similar effects for firms that were granted loans, but with conditions worse
than anticipated. Exploiting the panel structure shows that firms without recent credit market experience are less likely
to change their beliefs, which converge towards the middle category. Our findings are in line with theories of rational inattention
and with asymmetric experience effects.
