Monetary Transmission in Pakistan: The Balance Sheet Channel

Safia Shabbir

MPRA Paper from University Library of Munich, Germany

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

Keywords: Monetary Policy; Monetary Transmission; Firm; Models with Panel Data (search for similar items in EconPapers)
JEL-codes: C33 E50 E52 H32 (search for similar items in EconPapers)
Date: 2012-04-02
New Economics Papers: this item is included in nep-cwa, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:37862

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