Unintended Consequences of Central Bank Lending in Financial Crises

• 成果类型: Article
• 署名作者: van der Kwaak, Christiaan
• 署名单位: University of Groningen; University of Groningen
• 刊物名称: ECONOMIC JOURNAL
• ISSN/ISSBN: 0013-0133
• DOI: 10.1093/ej/uead078
• 发表日期: 2024
• 页码: 728-765
• 关键词: Sovereign default risk; monetary-policy; Debt crisis; liquidity; fragility; provision; channel; US

摘要

I investigate the macroeconomic impact of central bank funding becoming a more attractive funding source to financial intermediaries in times of crisis. I show that the requirement to pledge collateral has a contractionary effect on private credit, everything else equal, and thereby reduces the expansionary effect that such lending otherwise has. I use an estimated New Keynesian model with financial frictions to show that the collateral effect explains the limited growth of Italian banks' private credit in response to the European Central Bank's three-year longer-term refinancing operations. Finally, I explore whether changes in lending policy can offset the cumulative negative effects from the collateral effect.