Skip to main content
SpringerLink
Log in

Determinants and Consequences of Credit Tightening: An Analysis of the United States and the Euro Area

  • Chapter
A Flow-of-Funds Perspective on the Financial Crisis

Part of the book series: Palgrave Studies in Econmics and Banking ((PMSEB))

  • 207 Accesses

Abstract

The interaction between the financial and the real sectors of the econ- omy has been studied intensively in the past- We may refer to different strands of the literature, such as the correlation between money and national income (Friedman and Schwartz, 1963); the non-monetary effects of the banking crises in the propagation of the Great Depres- sion (Bernanke, 1983); the links between money, credit and GDP (Sims, 1972; Bernanke and Blinder, 1988, 1992); and the bank lending channel (Kashyapetal., 1993).

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
eBook
USD 16.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 109.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 109.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  • Aisen, A. and M. Franken (2010) ‘Bank Credit during the 2008 Financial Crisis: A Cross-Country Comparison’’, IMF Working Paper. No. 47.

    Google Scholar 

  • Albertazzi, U. and DJ. Marclietti (2010) Credit Supply. Flight to Quality and Evergreen ing: An Analysis of Bank-Finn Relationships after Lehman, Bank of Italy, mimeo.

    Google Scholar 

  • Altunbas, Y., Gambacorta, L. and D. Marqucz-ibancz (2009) ‘Bank Risk and Monetary Policy’, ECB Working Paper, No. 1075.

    Google Scholar 

  • Angeioni, L, Kashyap, A. and B. Mojon (2003) Monetary Policy Transmission in the Euro Area (Cambridge. UK: Cambridge University Press).

    Google Scholar 

  • Angeioni, I.. Kashyap, A.. Mojon, B. and D. Teriizzese (2002) ‘Monetary Transmission in the Euro Area: Where Do We Stand?’ ECB Working Papa-, No. 114.

    Google Scholar 

  • Arellano, M. and S. Bond (1991) ‘Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations’, Review of Economic Studies. 57 (1), 127–34.

    Google Scholar 

  • Bacchetta, P. and S. Gerladi (1997) ‘Consumption and Credit Constraints: international Evidence’, Journal of Monetary Economics, 40, 207–38.

    Google Scholar 

  • Bayoumi, T. and O. Melander (2008) ‘Credit Matters: Empirical Evidence on U.S. Macro-Financial Linkages’, IMF Working Paper, No. 169.

    Google Scholar 

  • Berg, j., van Rixtei, A., Ferrando, A., de Bondt, G. and S. Scopel (2005) ‘The Bank Lending Survey for the Euro Area’, ECB Occasional Papei’, No. 23.

    Google Scholar 

  • Bernanke, B.S. (1983) ‘Non-monetary Effects of the Financial Crisis in the Propagation of the Great Depression’, American Economic Re%ie,v, 73 (3), 257–76.

    Google Scholar 

  • Bernanke, B.S. and S. Blinder (1988) ‘Credit, Money and Aggregate Demand’, American Economic Review, 7 (2), 435–39.

    Google Scholar 

  • Bernanke, B.S. and S. Blinder (1992), ‘The Federal Funds Rate and the Channels of Monetary Transmission’, American Economic Review, 8 (4), 901–21.

    Google Scholar 

  • Bernanke, B.S. and C.S. Town (1991) ‘”Trie Credit Crunch’, Brookings Papers on Economic Activity, 2, 205–47.

    Google Scholar 

  • Berrospide, J.M. arid R.M. Edge (2010) ‘The Effects of Bank Capital on Lending: What Do We Know, and What Does it Mean?’ Federal Reserve Board Finance and Economics Discussion Paper, No. 44.

    Google Scholar 

  • Bordo, M.D. and j.G. Haubrich (2009) ‘Credit Crises, Money and Contractions: An Historical View’, NBER Working Paper, No. 15389.

    Google Scholar 

  • Cappiello, L., Kadareja, A., Sorensen, C.K. and M. Protopapa (2010) ‘Do Bank Loans and Credit Standards Have an Effect on Output? A Panel Approach for the Euro Area’, ECB Working Paper, No. 1150.

    Google Scholar 

  • Carlson, M., Shan, H. and M. Warusawitharana (2011) ‘Capital Ratios and Bank Lending: A Matched Bank Approach’, Federal Reserve Board Finance and Economics Discussion Papei-, No. 34.

    Google Scholar 

  • Cihak, M. and P.K. Brooks (2009) ‘From Subprimc Loans to Subprime Growth? Evidence for the Euro Area’. IMF Working Paper, No. 69.

    Google Scholar 

  • De Bondt, G., Maddaloni, A., Peydrö, J.-L. and S. Scopel (2010) ‘The Euro Area Bank Lending Survey Matters. Empirical Evidence for Credit and Output Growth’, ECB Working Papa; No. 1 160.

    Google Scholar 

  • Del Giovane, P., Framo, G. and A. Nobili (2010) Disentangling Demand and Supply in Credit Developments: A Survey-Based Analysis for Italy, Bank of Italy, mimeo.

    Google Scholar 

  • Driscoll, j.C. (2004) ‘Does Bank Lending Affect Output? Evidence from the U.S. States’, Journal of Monetary Economics. 51, 451–71.

    Google Scholar 

  • Fazzari, S.M., Hubbard, R.G. and B.C. Petersen (1988) ‘Financing Constraints and Corporate Investment’, Brookings Papers on Economic Activity; 1, 141–206.

    Google Scholar 

  • Freixas, X. and J.C. Rochet (2008) Microeconomics of Banking (Cambridge, MA: MIT Press).

    Google Scholar 

  • Friedman, M. and A.J. Schwartz (1963).4 Monetary History of the United States, 1867 I960 (Princeton: Princeton University Press).

    Google Scholar 

  • Gambacorta, L. and P.E. Mistrulli (2003) ‘Bank Capital and Lending Behaviour: Empirical Evidence for Italy’, Bank of Italy Temi diDiscussione. No. 486.

    Google Scholar 

  • Gorton, G.B. and A. Metrick (2012) ‘Getting up to Speed on the Financial Crisis: A One-Weekend-Reader’s Guide’, NBER Working Paper, No. 17778.

    Google Scholar 

  • Gui chard, S., Haugh, D. and D. Lurner (2009) ‘Quantifying the Effects of Financial Conditions in the Euro Area, Japan, United Kingdom and United States’, OECD Economic Department Working Paper. No. 677.

    Google Scholar 

  • JP Morgan Chase Bank (2009) ‘US: the Paradox of Bank Lending’, Economic Research Global Data Watch, 1.8 December.

    Google Scholar 

  • JP Morgan Chase Bank (2010) ‘G-4 Bank Lending Standards Stabilize but Demand Still Falls’, Economic Research Global Data Watch, 1.2 February.

    Google Scholar 

  • Kashyap, A.K., Stein, j.C. and D. Wilcox (1993) ‘Monetary Policy and Credit 1onditions: Evidence from the Composition of External Finance’, American Economic Review, 8 (1), 78–98.

    Google Scholar 

  • Kishan, R.P. and T.P. Opiela (2000) ‘Bank Size, Bank Capital and the Bank Lending Channel’, Journal of Money Credit and Banking, 3 (1), 121–41.

    Article  Google Scholar 

  • Kocherlakota, N. (2010) Modem Macroeconomic Models as Tools for Economic Policy, Federal Reserve Bank of Minneapolis, mimeo.

    Google Scholar 

  • Lown, C.S. and D.P. Morgan (2006) ‘The Credit Cycle and the Business Cycle: New Findings Using the Loan Officer Opinion Survey’, Journal of Money Credit and Banking, 3 (6),’” 1575–97.

    Article  Google Scholar 

  • Lown, C.S., Morgan, D.P. and S. Rohatgi (2000) ‘Listening to Loan Officers: the Impact of Commercial Credit Standards on Lending arid Output’, FRBNY Economic Policy Review, July, 1 16.

    Google Scholar 

  • Nier, E. and L. Zicchino (2008) ‘Bank Losses, Monetary Policy and Financial Stability Evidence on the Interplay from Panel Data’, IMF Working Papa, No. 232.

    Google Scholar 

  • Peek, J. and E.S. Rosengren (1995) ‘Banks and the Availability of Small Business Loans’, Federal Reserve Bank of’Boston Working Paper, No. 95–1.

    Google Scholar 

  • Saltari, E. (2001) ‘Financial Structure and Investment Decisions: A Survey of Theoretical and Empirical Work’, EII’C — Technology and Finance Working Paper, No. 2.

    Google Scholar 

  • Schul ar ick, M. and A.M. Taylor (2012) ‘Credit Booms Gone Bust: Monetary Policy, Leverage Cycles and Financial Crises, 1870–2008’, American Economic Review. 102 (2), 1870 2008.

    Google Scholar 

  • Sims, C. (1972) ‘Money, income and Causality’, American Economic Review. 62 (4), 540–52.

    Google Scholar 

  • Van den îlenvel, S.J. (2002) ‘Does Bank Capital Matter Cor Monetary Transmission?’ FRBNYEconomic PoIiqrReiiev,-, May, 259–65.

    Google Scholar 

  • VanHoose, D. (2007) “Theories of Bank Behavior under Capital Regulation’, Journal of Banking and Finance. 31 (12), 3680–97.

    Google Scholar 

Download references

Authors
  1. Riccardo De Bonis
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Luigi Infante
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Francesco Paternò
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

  1. European Central Bank, Frankfurt am Main, Germany

    Bernhard Winkler (Senior Advisor), Ad van Riet (Senior Advisor) & Peter Bull (Director General Statistics (retired) (Senior Advisor),  (Senior Advisor) &  (Director General Statistics (retired)

Copyright information

© 2014 Riccardo De Bonis, Luigi Infante and Francesco Paternò

About this chapter

Cite this chapter

Bonis, R.D., Infante, L., Paternò, F. (2014). Determinants and Consequences of Credit Tightening: An Analysis of the United States and the Euro Area. In: Winkler, B., Riet, A.v., Bull, P. (eds) A Flow-of-Funds Perspective on the Financial Crisis. Palgrave Studies in Econmics and Banking. Palgrave Macmillan, London. https://doi.org/10.1057/9781137352989_7

Download citation

Publish with us

Policies and ethics

Search

Navigation