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Contribution Details
| Type | Journal Article |
| Scope | Discipline-based scholarship |
| Title | Credit supply and monetary policy: identifying the bank balance-sheet channel with loan applications |
| Organization Unit | |
| Authors |
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| Item Subtype | Original Work |
| Refereed | Yes |
| Status | Published in final form |
| Language |
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| Journal Title | American Economic Review |
| Publisher | American Economic Association |
| Geographical Reach | international |
| ISSN | 0002-8282 |
| Volume | 102 |
| Number | 5 |
| Page Range | 2301 - 2326 |
| Date | 2012 |
| Abstract Text | We analyze the impact of monetary policy on the supply of bank credit. Monetary policy affects both loan supply and demand, thus making identification a steep challenge. We therefore analyze a novel, supervisory dataset with loan applications from Spain. Accounting for time-varying firm heterogeneity in loan demand, we find that tighter monetary and worse economic conditions substantially reduce loan granting, especially from banks with lower capital or liquidity ratios; responding to applications for the same loan, weak banks are less likely to grant the loan. Finally, firms cannot offset the resultant credit restriction by applying to other banks. (JEL E32, E44, E52, G21, G32) |
| Free access at | DOI |
| Official URL | http://www.aeaweb.org/articles.php?doi=10.1257/aer.102.5.2301 |
| Digital Object Identifier | 10.1257/aer.102.5.2301 |
| Other Identification Number | merlin-id:9205 |
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