The origins of aggregate fluctuations in a credit network economy

• 成果类型: Article
• 署名作者: Altinoglu, Levent
• 署名单位: Federal Reserve System - USA; Federal Reserve System Board of Governors; Federal Reserve System - USA; Federal Reserve System Board of Governors
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2020.01.007
• 发表日期: 2021
• 关键词: Credit network; Input-Output economy; Trade credit; financial frictions; business cycles

摘要

Inter-firm lending plays an important role in business cycle fluctuations. I build a network model of the economy in which trade in intermediate goods is financed by supplier credit. A financial shock to one firm affects its ability to make payments to its suppliers. The credit linkages between firms propagate financial shocks, amplifying their aggregate effects. To calibrate the model, I construct a proxy of inter-industry credit flows from firm-and industry-level data. I estimate aggregate and idiosyncratic shocks to US industries and find that financial shocks are a prominent driver of cyclical fluctuations, particularly during the Great Recession. Published by Elsevier B.V.