Conventional monetary interventions through the credit channel and the rise of non-bank institutions

Gianluca Cafiso and Giulia Rivolta

Economic Systems, 2024, vol. 48, issue 1

Abstract: The amount of credit assets held by non-bank institutions has increased substantially in recent decades, to the point where it exceeded the amount held by depository institutions in the United States before the Global Financial Crisis. Our research aims to gain evidence on whether the credit channel of monetary policy, i.e. the transmission of monetary interventions through bank lending, has been altered by the enlargement of the non-bank sector. The analysis is based on the period before the Global Financial Crisis in order to apply a theory-consistent identification of conventional monetary interventions within a large Bayesian vector auto-regression. The results indicate an uncertain transmission when the non-bank sector is larger, casting doubt on the grip of monetary interventions in an evolving scenario.

Keywords: Banks; Shadow-banking system; Loans; Mortgages; Monetary interventions; Bayesian VAR (search for similar items in EconPapers)
JEL-codes: C11 E44 E51 G20 G21 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0939362523000894
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecosys:v:48:y:2024:i:1:s0939362523000894

DOI: 10.1016/j.ecosys.2023.101150

Access Statistics for this article

Economic Systems is currently edited by R. Frensch

More articles in Economic Systems from Elsevier Contact information at EDIRC.
Bibliographic data for series maintained by Catherine Liu ().