Listening to the Market: Estimating Credit Demand and Supply from Survey Data

Satoru Kanoh and Chakkrit Pumpaisanchai

Hi-Stat Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: The literature referring to the credit slowdown has been plagued by the identification problem of whether a decline in a bank's credit is derived from the demand or the supply side. This paper proposes an original approach in directly estimating the credit demand and the credit supply from survey data. Using the TANKAN and the recently published Senior Loan Officer survey data, the paper demonstrates that the observed lending amount did not change much during the period of study; however, the observed lending amount deviated, as one might expect, from the estimated credit demand and credit supply for every firm size. This credit mismatch presents evidence of credit market imperfections and is of interest for further investigation as a possible explanation of firms' liquidity constraints and banks' lending mechanisms.

Keywords: Credit demand; Credit supply; Survey data; Japanese Economy (search for similar items in EconPapers)
JEL-codes: C42 C51 E10 O53 (search for similar items in EconPapers)
Date: 2006-02
New Economics Papers: this item is included in nep-fmk, nep-mac and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:hst:hstdps:d05-137

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