Franklin, Jeremy, Rostom, May and Thwaites, Gregory (2019) The banks that said no: the impact of credit supply on productivity and wages. Journal of Financial Services Research, 57 (2). 149 - 179. ISSN 0920-8550
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Abstract
This paper estimates the effects of changes in bank credit supply on the real economy. We use UK firm-level data around the global financial crisis and information on pre-existing bank lending relationships to isolate exogenous credit supply shocks. We find some evidence that contractions in credit supply substantially reduce labour productivity, wages, and capital per worker within firms, and increase the chance firms will fail. Our results have implications for the welfare costs of financial crises, and for the costs of policy measures affecting credit supply at other times.
Item Type: | Article |
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Official URL: | https://www.springer.com/journal/10693 |
Additional Information: | © 2019 The Authors |
Divisions: | Economics |
Subjects: | H Social Sciences > HG Finance |
JEL classification: | D - Microeconomics > D2 - Production and Organizations > D24 - Production; Cost; Capital and Total Factor Productivity; Capacity G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages |
Date Deposited: | 02 May 2019 23:08 |
Last Modified: | 14 Sep 2024 07:47 |
URI: | http://eprints.lse.ac.uk/id/eprint/100543 |
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