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Contribution Details
| Type | Conference Presentation |
| Scope | Discipline-based scholarship |
| Title | Deposit Pricing with Cross-Selling Considerations. A New Micro Foundation for the Deposit Channel of Monetary Policy |
| Organization Unit | |
| Authors |
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| Presentation Type | paper |
| Item Subtype | Original Work |
| Refereed | Yes |
| Status | Published in final form |
| Language |
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| Event Title | NYU Stern Brownbag |
| Event Type | workshop |
| Event Location | New York City |
| Event Start Date | December 2 - 2021 |
| Event End Date | December 2 - 2021 |
| Abstract Text | Using administrative data on deposits and loans of every Norwegian with every Norwegian bank, we show that opening of a deposit account makes a household 17% more likely to borrow from the same bank later. This motivates banks to accept lower deposit spreads from likely future borrowers, and even accept negative deposit spreads in periods of low policy rates. Further, as future cross-selling profits are discounted less in lower rate periods, deposit spreads increase in policy rates. We show this to provide a new micro foundation for part of the Deposit Channel of Monetary Policy. |
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