The Impact of Monetary Policy on Bank Balance Sheets
Anil K. Kashyap
University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)
Jeremy C. Stein
Harvard University - Department of Economics; National Bureau of Economic Research (NBER)
NBER Working Paper No. w4821
This paper uses disaggregated data on bank balance sheets to provide a test of the lending view of monetary policy transmission. We argue that if the lending view is correct, one should expect the loan and security portfolios of large and small banks to respond differentially to a contraction in monetary policy. We first develop this point with a theoretical model; we then test to see if the model's predictions are borne out in the data.
Number of Pages in PDF File: 63working papers series
Date posted: September 1, 2000
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