Credit Allocation of Japanese Banks in the 1990s: Evidence from the Short-Term Economic Survey of Enterprises

41 Pages Posted: 22 Jan 2007

See all articles by Kazuo Ogawa

Kazuo Ogawa

Osaka University - Institute of Social and Economic Research (ISER)

Date Written: January 2007

Abstract

This study is an empirical attempt to investigate the effects of balance sheet deterioration of Japanese firms and banks during the 1990s on credit allocation using the Short-term Economic Survey of Enterprises. This survey includes a unique item: the proportion of firms perceiving the lending attitude to be severe. After developing a theoretical model to link this item with the balance sheet conditions of borrowers and lenders, we estimated the relationships that we derived from our model. We found that credit was reduced when the balance sheet of firms and banks deteriorated. The effects are particularly significant for non-manufacturing industries.

Keywords: Tankan Survey, Credit crunch, Ever-greening, Non-performing loans, Corporate Debt

JEL Classification: E44, E51, G21

Suggested Citation

Ogawa, Kazuo, Credit Allocation of Japanese Banks in the 1990s: Evidence from the Short-Term Economic Survey of Enterprises (January 2007). Available at SSRN: https://ssrn.com/abstract=958151 or http://dx.doi.org/10.2139/ssrn.958151

Kazuo Ogawa (Contact Author)

Osaka University - Institute of Social and Economic Research (ISER) ( email )

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