The Real Effects of Banks' Corporate Credit Supply: A Literature Review

92 Pages Posted: 15 Oct 2019 Last revised: 13 Dec 2020

See all articles by Ozan Güler

Ozan Güler

Universitat Pompeu Fabra - Department of Economics and Business

Mike Mariathasan

KU Leuven- Faculty of Economics & Business

Klaas Mulier

Ghent University - Faculty of Economics and Business Administration

Nejat Gökhan Okatan

KU Leuven - Faculty of Economics & Business

Date Written: October 1, 2019

Abstract

In this paper, we review the rapidly growing literature on the real effects of banks' corporate credit supply. We cover recent methodological advances and provide an in-depth survey of the existing evidence. The literature consistently shows that credit supply contractions lead to adverse real outcomes, but economic magnitudes vary across samples and identification strategies. This variation has become smaller in more recent work, using highly granular data. We further document heterogeneity in firm outcomes and show that the evidence is more ambiguous for expansionary shocks. Our analysis allows us to identify current knowledge gaps and worthwhile avenues for future research.

Keywords: Credit supply; Corporate credit; Bank health; Real effects

JEL Classification: G21, E22, E24, E50

Suggested Citation

Güler, Ozan and Mariathasan, Mike and Mulier, Klaas and Okatan, Nejat Gökhan, The Real Effects of Banks' Corporate Credit Supply: A Literature Review (October 1, 2019). Available at SSRN: https://ssrn.com/abstract=3463018 or http://dx.doi.org/10.2139/ssrn.3463018

Ozan Güler (Contact Author)

Universitat Pompeu Fabra - Department of Economics and Business ( email )

Barcelona
Spain

Mike Mariathasan

KU Leuven- Faculty of Economics & Business ( email )

Naamsestraat 69
Leuven, B-3000
Belgium

Klaas Mulier

Ghent University - Faculty of Economics and Business Administration ( email )

Ghent, B-9000
Belgium

Nejat Gökhan Okatan

KU Leuven - Faculty of Economics & Business ( email )

Naamsestraat 69
Leuven, B-3000
Belgium
0486454752 (Phone)

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