The Effect of Cash Injections: Evidence from the 1980s Farm Debt Crisis

• 成果类型: Article
• 署名作者: Bergman, Nittai K.; Iyer, Rajkamal; Thakor, Richard T.
• 署名单位: Tel Aviv University; Imperial College London; University of Minnesota System; University of Minnesota Twin Cities
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhaa012
• 发表日期: 2020
• 页码: 5092
• 关键词: agricultural output; random fluctuations; economic-impacts; monetary-policy; CLIMATE-CHANGE; weather; credit; channel

摘要

What is the effect of cash injections during financial crises? Exploiting county-level variation arising from random weather shocks during the 1980s Farm Debt Crisis, we analyze and measure the effect of local weather-driven cash flow shocks on the real and financial sectors. We show that such cash flow shocks significantly affect a host of economic outcomes, including land values, loan delinquency rates, the probability of bank failure, employment, and wages. Estimates of the effect of local cash flow shocks on county income levels during the financial crisis yield a multiplier of 1.63.