Did BOJ's Negative Interest Rate Policy Increase Bank Lending?
Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)
We investigate the effects of the negative interest rate policy (NIRP) in Japan on bank lending using regression discontinuity design (RDD). On January 29, 2016, the Bank of Japan announced the beginning of the NIRP from February 16, 2016. Since the financial market did not anticipate this policy, we use the event as a natural experiment. For a few months, starting from February 2016, a negative interest rate was levied on banks that held reserves exceeding the average monthly reserves of 2015. This allows us to employ RDD. The results suggest the average treatment effect on the banks to which a negative interest was levied was approximately -1.5% to -3.5%. In other words, the loan rates of banks to which negative interest rates were levied declined compared to those of the banks that were not subject to NIRP.
New Economics Papers: this item is included in nep-cba and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eti:dpaper:18086
Access Statistics for this paper
More papers in Discussion papers from Research Institute of Economy, Trade and Industry (RIETI) Contact information at EDIRC.
Bibliographic data for series maintained by TANIMOTO, Toko ().