: Balance Sheet Channel of Monetary Transmission in Pakistan: An Empirical Investigation

Safia Shabbir ()
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Safia Shabbir: State Bank of Pakistan

SBP Research Bulletin, 2012, vol. 8, 1-12

Abstract: Using data of non-financial listed firms over a period of 1999-2010, this paper investigates the effectiveness of balance sheet channel of monetary transmission mechanism in Pakistan. By classifying firms as SME and large, it finds a strong evidence for the existence of net worth channel. A tight monetary policy worsens the net worth of both the SMEs and large firms, with SMEs getting more hit on their cash flows, short-term borrowing, and revenues.

Keywords: Monetary policy; monetary transmission; balance sheet channel (search for similar items in EconPapers)
JEL-codes: C33 E50 E52 H32 (search for similar items in EconPapers)
Date: 2012
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