Spillovers of asset purchases within the real sector: Win-win or joy and sorrow?
No 22/2019, IWH Discussion Papers from Halle Institute for Economic Research (IWH)
Events which have an adverse or positive effect on some firms can disseminate through the economy to firms which are not directly affected. By exploiting the first large sovereign bond purchase programme of the ECB, this paper investigates whether more lending to some firms spill over to firms in the surroundings of direct beneficiaries. Firms operating in the same industry and region invest less and reduce employment. The paper shows the importance to consider spillover effects when assessing unconventional monetary policies: Differences between treatment and control groups can be entirely attributed to negative effects on the control group.
Keywords: asset purchase programmes; small and medium enterprises; investments (search for similar items in EconPapers)
JEL-codes: D22 E58 G21 G28 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac and nep-mon
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:iwhdps:222019
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