Integration benefits on EU retail credit markets: evidence from interest rate pass-through

Friedrich Heinemann and Martin Schüler

No 02-26, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Lending and borrowing interest rates are often slow to adjust to changing capital market conditions. This paper argues that national differences of the pass-through speed in the EU can be regarded as a retail-oriented indicator of financial integration. Based on an ECB database the speed of interest rate adjustments for different markets and countries is measured - showing a considerable fragmentation of markets. Simulations show how much consumers in some countries could gain from a convergence of adjustment speed on the fastest levels.

Keywords: interest rate pass-through; financial market integration; EU (search for similar items in EconPapers)
JEL-codes: E43 F23 G15 (search for similar items in EconPapers)
Date: 2002
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Citations: View citations in EconPapers (26)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:871

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