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The B.E. Journal of Macroeconomics

Editor-in-Chief: Cavalcanti, Tiago / Kambourov, Gueorgui

Ed. by Abraham, Arpad / Carceles-Poveda , Eva / Debortoli, Davide / Lambertini, Luisa / Nimark, Kristoffer / Wang, Pengfei

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1935-1690
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The bank lending channel and monetary policy rules for Eurozone banks: further extensions

Nicholas Apergis / Stephen M. Miller
  • Economics, University of Nevada, Las Vegas, 4505 S Maryland Parkway Box 456005, Las Vegas, Nevada 89164-6005, USA
  • Other articles by this author:
  • De Gruyter OnlineGoogle Scholar
/ Effrosyni Alevizopoulou
Published Online: 2014-06-12 | DOI: https://doi.org/10.1515/bejm-2014-0044

Abstract

The monetary authorities affect macroeconomic activity through various channels of influence. This paper examines the bank lending channel, which considers how central bank actions affect the loan supply through its main indicator of policy, the real short-term interest rate. This paper employs the endogenously determined target interest rate, emanating from the European Central Bank’s monetary policy rule, to examine the operation of the bank lending channel. Furthermore, it examines whether different bank-specific characteristics affect how Eurozone banks react to monetary shocks. That is, do sounder banks react more to the monetary policy rule than less-sound banks? The paper finds evidence of an active and statistically and economically significant bank lending channel for the Eurozone between 2000 and 2009.

Keywords: bank lending channel; Eurozone banks; GMM methodology; Monetary policy rules

JEL: G21; E52; C33

References

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About the article

Corresponding author: Nicholas Apergis, Economics, Curtin University, Western Australia, 6102 Australia, e-mail:


Published Online: 2014-06-12

Published in Print: 2015-01-01


Citation Information: The B.E. Journal of Macroeconomics, Volume 15, Issue 1, Pages 93–112, ISSN (Online) 1935-1690, ISSN (Print) 2194-6116, DOI: https://doi.org/10.1515/bejm-2014-0044.

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