Smets, F. and Villa, Stefania (2016) Slow recoveries: any role for corporate leverage? Working Paper. Birkbeck, University of London, London, UK.
|
Text
26650.pdf - Draft Version Download (947kB) | Preview |
Abstract
This paper examines whether financial conditions of the non-financial corporate sector can ex- plain why the recovery from recessions in the United States is slower since the mid-1980s. Lever- age by the corporate sector has increased significantly since the financial deregulation of the mid-1980s. Empirical evidence shows that slow recoveries are associated with a significant drop in the growth rates of investment and bank loans, and with a surge in the growth rates of cor- porate bonds. In an estimated dynamic stochastic general equilibrium model with a financial accelerator, counterfactual experiments based on estimates of two samples 1965-1983 and 1984- 2007 show that the non-financial corporate indebtedness affects only marginally the speed of the recovery in the two samples.
Metadata
| Item Type: | Monograph (Working Paper) |
|---|---|
| Additional Information: | BCAM 1602; ISSN 1745-8587 |
| Keyword(s) / Subject(s): | speed of recoveries, indebtedness, financial frictions, estimated DSGE model |
| School: | Birkbeck Faculties and Schools > Faculty of Business and Law > Birkbeck Business School |
| Research Centres and Institutes: | Applied Macroeconomics, Birkbeck Centre for |
| Depositing User: | Administrator |
| Date Deposited: | 21 Mar 2019 16:18 |
| Last Modified: | 02 Aug 2023 17:49 |
| URI: | https://eprints.bbk.ac.uk/id/eprint/26650 |
Statistics
Additional statistics are available via IRStats2.
Archive Staff Only (login required)
