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The Bank Lending Channel Revisited.
- Source :
- Journal of Money, Credit & Banking (John Wiley & Sons, Inc.); Jun2011, Vol. 43 Issue 4, p711-734, 24p, 5 Graphs
- Publication Year :
- 2011
-
Abstract
- A central proposition in research on the role of banks in the transmission mechanism is that monetary policy imparts a direct impact on deposits and that deposits act as the driving force of bank lending. This paper argues that the emphasis on policy-induced changes in deposits is misplaced. A reformulation of the bank lending channel is proposed that works primarily through the impact of monetary policy on banks' balance sheet strength and risk perception. Such a recasting implies, contrary to conventional wisdom, that greater reliance on market-based funding enhances the importance of the channel. [ABSTRACT FROM AUTHOR]
Details
- Language :
- English
- ISSN :
- 00222879
- Volume :
- 43
- Issue :
- 4
- Database :
- Complementary Index
- Journal :
- Journal of Money, Credit & Banking (John Wiley & Sons, Inc.)
- Publication Type :
- Academic Journal
- Accession number :
- 60647325
- Full Text :
- https://doi.org/10.1111/j.1538-4616.2011.00394.x