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Bank Lending in the Knowledge Economy

Giovanni Dell'ariccia, Dalida Kadyrzhanova, Camelia Minoiu and Lev Ratnovski ()

No 2020-040, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: We study the composition of bank loan portfolios during the transition of the real sector to a knowledge economy where firms increasingly use intangible capital. Exploiting heterogeneity in bank exposure to the compositional shift from tangible to intangible capital, we show that exposed banks curtail commercial lending and reallocate lending to other assets, such as mortgages. We estimate that the substantial growth in intangible capital since the mid-1980s explains around 30% of the secular decline in the share of commercial lending in banks' loan portfolios. We provide suggestive evidence that this reallocation increased the riskiness of banks' mortgage lending.

Keywords: Bank lending; Corporate intangible capital; Real estate loans; Commercial loans (search for similar items in EconPapers)
JEL-codes: E22 E44 G21 (search for similar items in EconPapers)
Pages: 75 p.
Date: 2020-05-22
New Economics Papers: this item is included in nep-ban, nep-cfn, nep-his, nep-knm and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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https://www.federalreserve.gov/econres/feds/files/2020040pap.pdf (application/pdf)

Related works:
Journal Article: Bank Lending in the Knowledge Economy (2021) Downloads
Working Paper: Bank lending in the knowledge economy (2020) Downloads
Working Paper: Bank Lending in the Knowledge Economy (2018) Downloads
Working Paper: Bank Lending in the Knowledge Economy (2017) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2020-40

DOI: 10.17016/FEDS.2020.040

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