The impact of monetary policy and agent heterogeneity on firm financing structure: evidence from the USA

Anna Malinowska

Ekonomia journal, 2016, vol. 46

Abstract: Using panel modelling and firm-level data for 222 US listed companies I investigate how changes in monetary policy approximated by the three-month US LIBOR interest rate and its combined effect with firm-specific characteristics influenced firms’ financing decisions and their liability structure during the period 2005−2014. Reported findings suggest that despite the Zero Lower Bound on the Federal Funds Rate, the three-month US LIBOR has retained its impact on firm total debt, long-term bank debt and short-term trade credit. Monetary policy changes were found to have affected firm’s liability structure, especially through parameters such as size, collateral and profitability.

Keywords: balance sheet channel; LIBOR rate; ZLB; monetary policy; liabilities; corporate debt (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:eko:ekoeko:46_121

DOI: 10.17451/eko/46/2016/221

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