estimates of the returns to quality and coauthorship in economic academia salaries of academic economists are studied to determine if individuals receive differential returns to publishing articles of varying quality and to coauthored versus single authored articles estimates based on detailed data and a flexible nonlinear least squares procedure indicate that substantial returns to quality exist and that an individual s return from a coauthored paper with n authors is approximately 1 n times that of a single authored paper

a model of liquidity hoarding and term premia in inter bank markets financial crises are associated with reduced volumes and extreme levels of rates for term inter bank loans reflected in one month and three month libor we explain such stress by modeling leveraged banks precautionary demand for liquidity asset shocks impair a bank s ability to roll over debt because of agency problems associated with high leverage in turn banks hoard liquidity and decrease term lending as their rollover risk increases over the term of the loan high levels of short term leverage and illiquidity of assets lead to low volumes and high rates for term borrowing in extremis inter bank markets can completely freeze

environmental regulation and u s economic growth in this article we quantify the costs of pollution controls by reporting the results of simulations of the growth of the u s economy with and without regulation for this purpose we have constructed a detailed model of the economy that includes the determinants of long term growth we have also analyzed the interaction between industries in order to capture the full repercussions of environmental regulations however we have not attempted to assess the benefits resulting from a cleaner environment we find that pollution abatement has emerged as a major claimant on the resources of the u s economy the cost of emission controls is more than 10 of the total cost of government purchases of goods and services

systemic risk in financial systems a feedback approach abstract we develop an innovative framework to estimate systemic risk that accounts for feedback effects between the real and financial sectors we model the feedback effects through successive deterioration of borrowers creditworthiness and illiquidity spreading thus giving rise to a micro level financial accelerator between firms and banks we demonstrate that the model converges to a unique fixed point and the key role that centrality plays in shaping the level of amplification of shocks we also provide a mathematical framework to explain systemic risk variations in time as a function of the network characteristics of economic agents finally we supply empirical evidence on the economic significance of the feedback effects on comprehensive loan level data of the brazilian credit register our results corroborate the importance of incorporating new contagion channels besides the traditional interbank market in systemic risk models

nonmonetary effects of the financial crisis in propagation of the great depression this paper examines the effects of the financial crisis of the 1930s onthe path of aggregate output during that period our approach is complementary to that of friedman and schwartz who emphasized the monetary impact of the bank failures we focus on non monetary primarily credit related aspects of the financial sector output link and consider the problems of debtors as well as those of the banking system we argue that the financial disruptions of 1930 33 reduced the efficiency of the credit allocation process and that the resulting higher cost and reduced availability of credit acted to depress aggregate demand evidence suggests that effects of this type can help explain the unusual length and depth of the great depression this abstract was borrowed from another version of this item

obsolescence of knowledge and career publication profiles some evidence of differences among fields in costs of interrupted careers in recent years women have received about 45 percent of all baccalaureate degrees but only approximately 20 percent of all ph d s does this imply that academic careers as compared with careers of the wider market for college graduates are less conducive to dual career family objectives evidence suggesting the relative tradeoff of these objectives is shown by the fact that over the last thirty years the zero order correlation between average cohort fertility and the proportion of ph d recipients who are women is 0 939 a female recipient of a doctorate is twice as likely as a male recipient to have specialized in the humanities and only one third as likely to have specialized in a physical science field furthermore of those who receive a doctorate in physical science a male is 60 percent more likely than a female to pursue research as a primary work activity in the humanities on the other hand a woman is at least as likely as a man to have research as an initial postdoctoral work activity obviously many factors affect opportunities and resultant decisions to enter particular careers and to select specific occupational specialties this study considers only onethe rate of obsolescence or depreciation of knowledge as reflected in the age profile of cited works this measure of the obsolescence of knowledge refers to the rate of decay in the relative frequency at which citations are made to a particular vintage of research communications as the communications age in other words the usefulness of older published research papers as an input to current research depreciates over time the rate at which this depreciation occurs is interpreted as measuring the durability of a professor s accumulated stock of knowledge evidence presented in section ii indicates that the durability of knowledge varies considerably from discipline to discipline this information raises a number of questions concerning how the durability of knowledge influences career decisions one influence considered here is that of a temporary career interruption for example if a woman experiences a break in her academic career such as for the purpose of raising children she will incur an opportunity cost in the sense that her research knowledge will to some extent become obsolete consequently her accumulated stock of knowledge will decline relative to those professors who have continuous careers the relative cost imposed on a woman who pursues dual family career objectives is higher the less durable the jobrelated knowledge this difference in relative costs is expected to alter career incentives the results presented here suggest that women who pursue academic careers have responded to these incentives before discussing the evidence on female careers i consider a more general model in which a professor is assumed to have a continuous career profile this model which is more appropriately viewed as a male model of investment behavior is used to analyze how the durability of a professor s knowledge affects his research productivity over a career interestingly the evidence suggests that a professor s response to less durable knowledge is not to compact all learning early in his career but rather to smooth learning over the career perhaps the most assistant professor arizona state university i would like to thank an anonymous referee and many friends for helpful comments on earlier drafts i am especially indebted to finis welch for valuable suggestions throughout the development of this paper the views expressed are my own and i am responsible for any possible errors

consequences of bank distress during the great depression the consequences of bank distress for the economy during the depression remain an area of unresolved controversy since john m keynes 1931 and irving fisher 1933 macroeconomists have argued that bank distress magnified the extent of the economic decline during the depression as the intermediaries controlling money and credit banks were in a special position to transmit their distress to other sectors but the mechanism through which banking distress mattered for the economy has been hotly contested milton friedman and anna j schwartz 1963 saw the contraction in the money multiplier driven in their view by panicked depositors withdrawals of deposits as the primary mechanism through which banking distress affected the real economy they described the mechanism transmitting banking distress to the real sector as operating at the national level through changes in the aggregate supply of money and interest rates bank distress reduced the money supply available to the public either through the closure of banks and the consequent freezing of bank deposits or the withdrawals of deposits by depositors that feared bank failure ben s bernanke 1983 building on fisher 1933 emphasized the transmission of monetary shocks via their effects on the balance sheets of borrowers and on the supply of credit by banks borrowers balance sheets were worsened by debt deflation as the result of fixed dollar debt obligations borrowers net worth and cash flow declined with the rising value of debt service costs relative to income borrowers with positive net present value projects but weak balance sheets had less internally generated retained earnings to invest and could not qualify for credit furthermore bernanke argued that the contraction of the money supply produced contraction of nominal income and prices relative to fixed debt service which weakened borrowers balance sheets and in turn weakened banks not only did firms financial distress reduce the number of qualified borrowers the contraction in banks net worth forced a reduction in the supply of bank loans to qualified borrowers many firms and individuals relied on banks for credit and as those banks suffered losses of capital due to asset value declines and contractions in deposits as depositors reacted to bank weakness by withdrawing their funds even borrowers with viable projects and strong balance sheets experienced a decrease in the effective supply of loanable funds bernanke termed the combined weakening of borrowers balance sheets and the contraction in bank credit supply a rise in the cost of credit intermediation the scarcity of perfect substitutes for the positive net present value investments of firms with weak balance sheets and for the credit supplied by existing banks implies that the weakening of firms and banks balance sheets the disappearance of banks and the contraction in surviving banks lending made it more difficult for the economy to channel funds to their best use thus what began as a contraction in aggregate demand became a contraction in aggregate supply which magnified adverse economic shocks and prolonged and deepened the depression the financial distress of firms and banks and the decline in bank lending were not only symptoms of the depression but means for magnifying the shocks that caused the depression bernanke s statistical evidence in support of this story is derived from time series analysis at the national level in calomiris graduate school of business 601 uris hall columbia university 3022 broadway new york ny 10027 and national bureau of economic research e mail cc374 columbia edu mason department of finance drexel university 3141 chestnut street philadelphia pa 19104 e mail joe mason drexel edu we thank valerie ramey david wheelock charles himmelberg steve zeldes gary gorton two referees and seminar participants at columbia university wharton northwestern university and the 2001 economic history association meetings for helpful comments on an earlier draft we gratefully acknowledge support from the national science foundation the university of illinois and the federal reserve bank of st louis

trade credit the financial crisis and sme access to finance mounting evidence indicates that firms particularly smes suffered from a significant credit crunch during this crisis we analyze for the first time whether trade credit provided an alternative source of external finance to smes during the crisis using firm level spanish data we find that credit constrained smes depend on trade credit but not bank loans and that the intensity of this dependence increased during the financial crisis unconstrained firms in contrast are dependent on bank loans but not on trade credit

patterns of research productivity in the business ethics literature insights from analyses of bibliometric distributions in any academic discipline published articles in respective journals represent production units of scientific knowledge and bibliometric distributions reflect the patterns in such outputs across authors or producers closely following the analysis approach used for similar studies in the economics and finance literature we present the first study to examine whether there exists an empirical regularity in the bibliometric patterns of research productivity in the business ethics literature our results present strong evidence that there indeed exists a distinct empirical regularity it is the so called generalized lotka s law of scientific productivity pattern the number of authors publishing n papers is about 1 n c of those publishing one paper we discuss the likely processes that underlie the productivity pattern postulated by the generalized lotka s law we find that the value of the exponent c is equal to about 2 6 for the comprehensive bibliometric data across the two leading business ethics journals the observed research productivity pattern in the business ethics area a relatively young discipline is interestingly very consistent with those found in much older related business disciplines like economics accounting and finance we discuss the general implications of our findings

patterns of productivity in the finance literature a study of the bibliometric distributions this study finds a bibliometric regularity in the finance literature that the number of authors publishing n papers is about 1 nc of those publishing one paper we find that the finance literature conforms very well to the inverse square law c 2 if data are taken from a large collection of journals when applied to individual finance journals we find that values of c range from 1 95 to 3 26 we also find that top rated journals have higher concentrations among their contributors this implies that the phenomenon success breeds success is more common in higher quality publications it is frequently observed in bibliometric matters and in various social phenomena that success breeds success a frequently cited paper is more likely to be cited again than one little cited an author of many papers is more likely to publish again than one who has published little a journal which has been frequently consulted is more likely to be consulted again than one of previously infrequent use this is analogous to the folk saying the rich get richer and the poor get poorer lotka s law of scientific productivity is an example of such empirical laws lotka 1926 proposes an inverse square law relating authors of scientific papers to the number of papers written by each author specifically using data in the decennial index of chemical abstracts and in the name index of auerbach s geschichtstafeln der physik lotka plots the number of authors against the number of contributions made by each author on a logarithmic scale lotka finds that the points are closely scattered around a straight line having a slope of approximately negative two on the basis of this empirical observation lotka concludes the following in the cases examined it is found that the number of persons making 2 contributions is about one fourth of those making one the number making 3 contributions is about one ninth etc the number making n contributions is about 1 n2 of those making one and of all contributors the proportion that make a single contribution is about 60 percent thus lotka s empirical finding can be summarized by the equation an a1 n2 n 1 2 3 1

institutional contributions to the leading finance journals 1975 through 1986 a note in a recent issue of this journal heck cooley and hubbard 2 provided several rankings of finance departments the various rankings were based on publications in the journal of finance since 1946 the year in which the journal began publication separate rankings were generated for the leading institutions on the basis of source of doctorate and current employment the employer rankings were provided for the past forty years 1946 through 1985 and for several ten year subperiods 1946 through 1955 1956 through 1965 1966 through 1975 and 1976 through 1985 the work by heck cooley and hubbard builds on earlier contributions by klemkosky and tuttle 3 4 schweser 6 ederington 1 and moore and taylor 5 in their two papers klemkosky and tuttle measured the contributions to two groups of journals for the period 1966 through 1975 they included the volume of scholarship published in the three leading finance journals journal of finance journal of financial and quantitative analysis and journal of financial economics they also included the contributions to eight leading business and economics journals that publish finance and finance related articles journal of business journal of money credit and banking american economic review review of economics and statistics econometrica quarterly journal of economics journal of political economy and journal of monetary economics in their first paper klemkosky and tuttle 3 measured research performance according to the institutional source of publications in their follow up paper 4 they ranked programs on the basis of the publication output of doctoral students in a related paper schweser 6 analyzed the doctoral origins of contributions to the journal of finance for 1964 through 1975 ederington 1 prepared rankings of the top twenty departments based on total pages published in the journal of finance and journal of financial and quantitative analysis and citations in the social science citation index for works in these journals for the period 1967 through 1972 moore and taylor 5 tabulated the number of articles and pages published during 1972 through 1978 in fifteen leading journals in five academic areas of business including finance marketing management science behavioral management and general business for each area three journals were included and in finance the journals were the journal of finance journal of financial and quantitative analysis and financial management publication performance rankings were provided for all fields combined and for each discipline individually

the currency dimension of the bank lending channel in international monetary transmission abstract we investigate how the use of a currency transmits monetary policy changes in the global banking system we use a newly available rarely accessed dataset on the bilateral cross border lending flows of 27 bis reporting lending banking systems to borrowers in 51 countries broken down by currency denomination usd eur and jpy we have three main findings first we identify a currency dimension of the international bank lending channel monetary changes in a currency significantly affect cross border lending flows in that currency even when neither the lending banking system nor the target country uses that currency as their own second this transmission works mainly through lending to non banks third the currency dimension of the bank lending channel works similarly across the three currencies suggesting that the usd may not be unique in this respect

precautionary reserves and the interbank market large excess reserve balances are held by banks in the u s despite the ability of large banks to closely target end of day balances close to zero we show that the friction faced by small banks to participate in the fed funds market leads to all banks holding precautionary reserves the precautionary motive for reserves can explain that small banks hold relatively large amounts of excess reserves overnight while at the same time lending large amounts to large banks small banks are large net lenders despite their reluctance to lend as large of a percentage of available balances during the day as large banks we also explain an increase in the volatility of the fed funds rate late in the day

zombie lending and depressed restructuring in japan this paper explores the role that misdirected bank lending played in prolonging the japanese macroeconomic stagnation that began in the early 1990s the investigation focuses on the wide spread practice of japanese banks of continuing to lend to otherwise insolvent firms we docu ment the prevalence of this forbearance lending and show its distorting effects on healthy firms that were competing with the impaired firms the paper by hoshi 2000 was the first to call attention to this phenomenon and its ramifi

sovereign stress and smes access to finance evidence from the ecb s safe survey abstract we study the effect of sovereign stress on smes capital structure using restricted access data from the european central bank we find that during the sovereign debt crisis and controlling for borrowers quality firms in stressed countries became more likely to be denied credit to be credit rationed and to face higher loan rates less creditworthy firms were not more likely to become credit constrained suggesting no flight to quality in lending we also find that in order to make up for the decline in bank credit firms in stressed countries began relying considerably more on retained earnings and government subsidies

cross border effects of regulatory spillovers evidence from mexico abstract this paper studies the spillover of a macroprudential regulation in spain to the mexican financial system via mexican subsidiaries of spanish banks the spillover caused a drop in the supply of household credit in mexico municipalities with a higher exposure to spanish subsidiaries experienced a larger contraction in household credit these localized contractions caused a drop in macroeconomic activity in the local non tradable sector estimates of the elasticity of loan demand by the non tradable sector to changes in household credit supply range from 1 2 1 8 these results emphasize cross border effects of regulations in the presence of global banks

the evolution of a financial crisis collapse of the asset backed commercial paper market this paper documents runs on asset backed commercial paper abcp programs in 2007 we find that one third of programs experienced a run within weeks of the onset of the abcp crisis and that runs as well as yields and maturities for new issues were related to program level and macro financial risks these findings are consistent with the asymmetric information framework used to explain banking panics have implications for commercial paper investors degree of risk intolerance and inform empirical predictions of recent papers on dynamic coordination failures

the value of a finance journal publication the empirical analysis examines the salary and publication records of 311 finance professors at public research universities to calculate the worth of a top finance journal article within rank salary regressions provide measures of the direct returns of a journal publication while probit models consider the indirect returns that result from promotion ultimately the analysis uses a reduced form salary equation to measure both the direct and indirect effects of publishing a journal article depending on professorial rank the present value of the first top finance journal article is between 19 493 and 33 754 with the additional result of large returns to subsequent publications what is a journal publication worth has long been a question of interest to academics in the finance and economics profession perhaps it is the desire to value assets the need to examine personal economic decisions or simply intellectual curiosity that motivates the many studies that exist whatever the reason economists continue to investigate the marginal contribution to a professor s salary of publishing one more article in a refereed journal the extant empirical research typically uses multiple linear regression analysis to examine a publication s marginal contribution to salary regression results in studies by bertin and zivney 1992 and delorme hill and wood 1979 support a positive relation between a professor s salary and the number of publications in an attempt to capture diminishing marginal returns tuckman and leahey 1975 first estimated a salary regression inodel with dummy variables for different publication ranges i e 1 2 publications 3 4 publications 5 10 publications etc they fit an incremental salary curve to the estimated publication range coefficients and then used the nonlinear function to evaluate average and marginal returns a second important contribution to the literature by tuckman and leahey is their observation that a journal publication has both a direct and indirect

publish or perish what the competition is really doing this study provides comprehensive publications performance data over a twenty five year period for finance doctorates these data indicate that publishing one article per year in any finance journal or finance accounting economics or business journal over any prolonged period of time is a truly remarkable feat met by only 5 percent of the graduates tenure screens combining various quantity and quality requirements are examined to assess their ability to predict future publication productivity faculty and administrators seeking defensible benchmarks for evaluating faculty research productivity in finance will find that these data and results are particularly useful copyright 1992 by american finance association

relationship lending during a financial crisis this paper studies whether relationship lending mitigates the transmission of the lehman default shock to the supply of credit in italy exploiting the presence of multiple banking relationships we control for banks and firms unobserved characteristics results show that the growth of credit itself is higher and its cost lower the shorter the distance between the bank and the firm the longer the relationship and the higher the share of credit held by the bank credit growth by relationship lenders is 4 6 higher than that by transactional lenders the increase in the cost of credit is 50 basis points lower the positive effect of relationship lending on credit supply increased during the crisis compared to a pre crisis period the beneficial effect of relationship lending is weaker if the relationship lender is more exposed to the financial crisis especially when lending to weaker borrowers

lenders on the storm of wholesale funding shocks saved by the central bank abstractwe provide empirical evidence on banks responses to shocks in the wholesale funding market using data of 181 euro area banks over the period from august 2007 to june 2013 responses to funding liquidity shocks for both banks lending volumes and loan rates to households and corporates are analysed in a panel var framework we thereby distinguish banks by country extent of eurosystem borrowing bank size and capitalization the results show that shocks in the securities and interbank markets have significant effects on loan rates and credit supply particularly of banks in stressed countries of the periphery the results also suggest that central bank liquidity has mitigated this effect on lending volumes lending to nonfinancial corporations is more sensitive to wholesale funding shocks than lending to households lending volumes of large banks that are typically more dependent on wholesale funding and banks with large exposure to sovereign bonds show stronger responses to wholesale funding s

the impact of journals and authors on international business research a citational analysis of jibs articles in this paper we use citational analysis to examine the influence of individuals and disciplines on international business research we collected citational data over the ten year period 1984 to 1993 from every issue of the journal of international business studies we found that management economics marketing and finance disciplines have had significant influence on international business research and identified researchers such as dunning porter vernon casson rugman and hofstede as having made significant contributions to international business research

small bank comparative advantages in alleviating financial constraints and providing liquidity insurance over time we use novel monthly survey data from 1993 to 2012 on small business managerial perceptions of financial constraints and other conditions matched with information on banks in their local markets the data suggest that small banks have comparative advantages in alleviating these constraints these advantages tend to be greater during adverse economic conditions and do not appear to decrease or increase secularly small banks also appear to have comparative advantages in providing liquidity insurance to small business customers of large banks experiencing liquidity shocks during financial crises our findings suggest a source of social costs from ongoing consolidation of the banking industry received december 28 2015 editorial decision january 13 2017 by editor philip strahan

research productivity over the life cycle evidence for academic scientists the relationship between age and the publishing productivity of ph d scientists is analyzed using data from the survey of doctorate recipients national research council and the science citation index the longitudinal nature of the data allows for the identification of pure aging effects in five of the six areas studied life cycle aging effects are present only in particle physics where scientists often speak of being on a religious quest is the indication that scientific productivity is not investment motivated vintage effects are also considered the expectation that the latest educated are the most productive is not generally supported by the data copyright 1991 by american economic association

policy uncertainty lender of last resort and the real economy abstract a reduction in lender of last resort lolr policy uncertainty positively affects bank lending and propagates to investment and employment we exploit a unique policy that reduced uncertainty regarding the availability of future lolr funding for banks as a quasi natural experiment using micro level data on banks firms and loans in portugal we generate cross sectional variation in banks exposure to uncertainty and find that the size of the haircut subsidy the gap between private market and central bank security valuations plays a key role in the propagation of the shock to lending and the real economy

survive another day using changes in the composition of investments to measure the cost of credit constraints abstract we introduce a novel empirical strategy to measure the size of credit shocks theoretically we show that credit shocks reduce the value of long term relative to short term investments empirically we can therefore compare the reduction of long term relative to short term investments within firms allowing for firm times year fixed effects using spanish firm level data we estimate the credit crunch to be equivalent to an additional tax rate of around 11 on the longest lived capital to pin down credit constraints as the underlying cause we apply triple differences strategies using foreign ownership or precrisis debt maturity

contributions to financial crisis research an assessment of the literature in social science citation index journals from 1990 to 2008 research in the field of financial crisis has generated a considerable amount of literature in the past yet there has neither been any study to assess the contributions to the literature made by individuals or institutions nor any to measure the impact of the articles and researchers this study represents an attempt to 1 investigate the major journals in publishing financial crisis research 2 assess the contributions of individual researchers and institutions using the credited contribution approach and 3 measure the impact of individual publications and individual researchers on the financial crisis literature through citation analysis based on the publications in social science citation index ssci journals from 1990 to 2008 the findings provide a useful benchmark for assessing individual and institutional research productivity and trends for future research and venues for publications are identified

banks funding stress lending supply and consumption expenditure we employ a unique identification strategy linking survey data on household consumption expenditure to bank level data to estimate the effects of bank funding stress on consumer credit and consumption expenditures we show that households whose banks were more exposed to funding shocks report lower levels of nonmortgage liabilities this however only translates into lower levels of consumption for low income households hence adverse credit supply shocks are associated with significant heterogeneous effects

the contingent valuation debate why economists should care t he contingent valuation method involves the use of sample surveys questionnaires to elicit the willingness of respondents to pay for generally hypothetical projects or programs the name of the method refers to the fact that the values revealed by respondents are contingent upon the constructed or simulated market presented in the survey a spirited and occasionally mean spirited battle over such methods is currently being waged involving competing factions within the federal government economists and lawyers representing business and environmental groups and interested academics as well at issue is a seemingly quite specific question should environmental regulations currently under development at both the department of the interior and the department of commerce sanction the use of the contingent valuation method in estimating the damage done by spills of oil chemicals or other substances covered by federal law more generally the debate raises broad questions about what economists have to say about the values that individuals place on public or private goods the two papers that follow this one make cases for and against the use of the contingent valuation method my aim here is to provide an overview of the technique and the debate surrounding it i also want to suggest why this debate should matter to economists both professionally and in their roles as citizens and consumers

when arm s length is too far relationship banking over the credit cycle we conduct face to face interviews with bank ceos to classify 397 banks across 21 countries as either relationship or transaction lenders we then use the geographic coordinates of these banks branches and of 14 100 businesses to analyze how the lending techniques of banks in the vicinity of firms are related to credit constraints at two contrasting points of the credit cycle we find that while relationship lending is not associated with credit constraints during a credit boom it alleviates such constraints during a downturn this positive role of relationship lending is stronger for small and opaque firms and in regions with a more severe economic downturn moreover our evidence suggests thatrelationship lending mitigates the impact of a downturn on firm growth and does not constitute evergreening of loans

winter is possibly not coming mitigating financial instability in an agent based model with interbank market abstract we develop a macroeconomic agent based model to study how financial instability can emerge from the co evolution of interbank and credit markets and the policy responses to mitigate its impact on the real economy the model is populated by heterogenous firms consumers and banks that locally interact in different markets in particular banks provide credit to firms according to a basel ii or iii macro prudential frameworks and manage their liquidity in the interbank market the central bank performs monetary policy according to different types of taylor rules we find that the model endogenously generates market freezes in the interbank market which interact with the financial accelerator possibly leading to firm bankruptcies banking crises and the emergence of deep downturns this requires the timely intervention of the central bank as a liquidity lender of last resort moreover we find that the joint adoption of a three mandate taylor rule tackling credit growth and the basel iii macro prudential framework is the best policy mix to stabilize financial and real economic dynamics however as the liquidity coverage ratio spurs financial instability by increasing the pro cyclicality of banks liquid reserves a new counter cyclical liquidity buffer should be added to basel iii to improve its performance further finally we find that the central bank can also dampen financial instability by employing a new unconventional monetary policy tool involving active management of the interest rate corridor in the interbank market

export market exit and financial health in crises periods abstract this paper uses rich firm level data for the uk to investigate the link between firms financial health and export exit paying attention to the erm currency crisis and the global financial crisis our results show that deterioration in the financial position of firms has increased the hazard of export exit during the 2007 09 crisis but has no significant effect on the early 1990s crisis we also explore the extent to which firms in financially vulnerable industries face greater sensitivity of export exit to financial conditions we conclude that firms in sectors with great reliance on external finance experience higher hazards of exiting the export market during the 2007 09 crisis

did financial frictions stifle r d investment in europe during the great recession abstract we investigate the role of financial frictions in r d spending in a large sample of european firms our identification strategy exploits the contraction in credit supply that followed the 2008 09 global financial crisis and 2012 euro area sovereign debt crisis together with differences in financial frictions across firms and industries to identify a causal effect of financial constraints on investment in innovation we show that firms that are more likely financially constrained in industries more dependent on external finance invest disproportionally less in r d during periods of tight credit supply smaller private firms with weaker balance sheets also have a lower share of r d in total investment suggesting r d drops more than total investment during these crisis episodes these results are robust to different proxies of financial constraints and fixed effects identification strategies

does bank opacity affect lending abstract examining a sample of bank holding companies in the united states we find that opacity has a negative effect on bank loan growth this effect is more pronounced for banks that are more reliant on wholesale funds a further analysis of the relationship between opacity and wholesale funds confirms our hypothesis that opacity negatively affects lending via a wholesale funding channel moreover our results suggest that the negative effect of opacity on lending is less pronounced for banks with stronger capitalization we also show that this effect was stronger during the 2007 2009 financial crisis and is mitigated by a high gdp growth rate indicating that a strong weak macroeconomic condition tends to mitigate aggravate such an effect

do smes benefit from unconventional monetary policy and how microevidence from the eurozone we study the impact of the announcement of the european central bank s ecb s outright monetary transactions program on small firms access to finance using a matched firm bank data set from eight eurozone countries we find that following the announcement credit access improved relatively more for firms borrowing from banks with high balance sheet exposures to impaired sovereign debt with such firms less likely to be refused a loan or to be price rationed loan terms also improved as manifested by lengthening of loan maturities unconventional monetary policy has a positive impact on firms investment and profitability while its effect on firm innovation is weaker

monetary policy and bank profitability in a low interest rate environment we analyse the impact of standard and non standard monetary policy on bank profitability we use both proprietary and commercial data on individual euro area bank balance sheets and market prices our results show that a monetary policy easing a decrease in short term interest rates and or a flattening of the yield curve is not associated with lower bank profits once we control for the endogeneity of the policy measures to expected macroeconomic and financial conditions accommodative monetary conditions asymmetrically affect the main components of bank profitability with a positive impact on loan loss provisions and non interest income offsetting the negative one on net interest income a protracted period of low monetary rates has a negative effect on profits that however only materializes after a long time period and is counterbalanced by improved macroeconomic conditions monetary policy easing surprises during the low interest rate period improve bank stock prices and cds

procyclical capital regulation and lending we use a quasi experimental research design to examine the effect of model based capital regulation on the procyclicality of bank lending and firms access to funds in response to an exogenous shock to credit risk in the german economy capital charges for loans under model based regulation increased by 0 5 percentage points as a consequence banks reduced the amount of these loans by 2 1 to 3 9 percentage points more than for loans under the traditional approach with fixed capital charges we find an even stronger effect when we examine aggregate firm borrowing suggesting that microprudential capital regulation can have sizeable real effects

interbank liquidity crunch and the firm credit crunch evidence from the 2007 2009 crisis we study the credit supply effects of the unexpected freeze of the european interbank market using exhaustive portuguese loan level data we find that banks that rely more on interbank borrowing before the crisis decrease their credit supply more during the crisis the credit supply reduction is stronger for firms that are smaller with weaker banking relationships small firms cannot compensate the credit crunch with other sources of debt furthermore the impact of illiquidity on the credit crunch is stronger for less solvent banks finally we find no overall positive effects of central bank liquidity but instead higher hoarding of liquidity

what s your identification strategy innovation in corporate finance research we study the diffusion of techniques designed to identify causal relationships in corporate finance research we estimate that the diffusion started in the mid 1990s lagged 20 years compared to economics and is now used in the majority of corporate finance articles consistent with recent theories of technology diffusion the adoption varies across researchers based on individuals expected net benefits of adoption younger scholars holders of phds in economics and those working at top institutions adopt faster adoption is accelerated through networks of colleagues and alumni and is also facilitated by straddlers who cross over from economics to finance our findings highlight new forces that explain the diffusion of innovation and shape the norms of academic research this paper was accepted by gustavo manso finance

fear of fire sales illiquidity seeking and credit freezes is there any need to clean up a banking system in the midst of a crisis for instance by closing some weak banks and forcing others to sell bad assets or can one wait till the crisis is over we argue that an overhang of impaired banks that may be forced to sell assets in the future can increase the private returns to holding illiquid assets sufficiently that weak banks have no interest in selling them anticipating a potential future fire sale cash rich buyers have high expected returns to holding cash which also reduces their incentive to lock up money in term loans the potential for a worse fire sale than necessary as well as the associated decline in credit origination could make the crisis worse which is one reason it may make sense to clean up the system even in the midst of the crisis we discuss alternative ways of cleaning up the system and the associated costs and benefits

the price effects of monetary shocks in a network economy abstract empirical evidence shows monetary shocks have two temporary effects on the distribution of prices one the dispersion of cross section of prices increases in response to monetary shocks two some prices change in the wrong direction some prices decrease in response to positive monetary shocks and increase in response to negative monetary shocks we present a model that generates the two effects of monetary shocks on the distribution of prices as an out of equilibrium phenomena firms are related to each other through a production network monetary shocks change the working capital of a subset of firms and percolate to other firms through buyer seller linkages price dispersion increases because the percolation of a monetary shock through the production network causes prices to differentially deviate from their steady state values some prices change in the wrong direction because a shift in one firm s demand causes a shift in another firm s supply and vice versa thereby generating complicated chains of bi directional price changes monetary shocks can significantly disturb relative prices even when all prices are fully flexible

corporate investment and bank dependent borrowers during the recent financial crisis abstract we use the recent financial crisis period to analyse the effect of bank credit tightening on firm investment we derive a new set of credit tightening indexes from the ecb bank lending survey combining these with annual balance sheet data from germany france italy spain belgium and portugal we exploit the heterogeneity in the dependence on bank finance of different industries to identify real effects of credit tightening we show that in response to tightening investment falls substantially more in bank dependent industries

coordination failures and the lender of last resort was bagehot right after all the classical doctrine of the lender of last resort lolr elaborated by bagehot 1873 asserts that the central bank should lend to illiquid but solvent banks under certain conditions several authors have argued that this view is now obsolete in modern interbank markets a solvent bank cannot be illiquid this paper provides a possible theoretical foundation for rescuing bagehot s view our theory does not rely on the multiplicity of equilibria that arises in classical models of bank runs we built a model of banks liquidity crises that possesses a unique bayesian equilibrium in this equilibrium there is a positive probability that a solvent bank cannot find liquidity assistance in the market we derive policy implications about banking regulation solvency and liquidity ratios and interventions of the lender of last resort furthermore we find that public bailout and private bail in involvement are complementary in implementing the incentive efficient solution and that bagehot s lender of last resort facility must work together with institutions providing prompt corrective action and orderly failure resolution finally we derive similar implications for an international lender of last resort ilolr jel g21 g28

journal communication and influence in financial research this article uses the articles and citations from a set of eight finance journals to explore interjournal citation patterns the research interests of individual journals each journal s influence in particular areas areas of recent interest to finance and the extent of interdisciplinary borrowing by finance we find the following two journals comprise the research core of finance research most journals publish in a variety of research areas but are influential in a smaller number a higher level of interest in financial markets than in corporate finance or financial institutions and an overall low level of borrowing from outside disciplines in this study we use journal publication and citation data to explore the communication of knowledge through journals such data are used in finance research by zivney and bertin 1992 chung and cox 1990 and heck and cooley 1988 among others to explore research productivity and by jensen et al 1990 to explore journal ratings most recently schwert 1993 employs such data in examining the influence of the journal of financial economics since its inception these types of data are also useful for investigating knowledge communication because they provide evidence of both transmission and reception of knowledge among journals the remainder of this article is organized to address the following three issues interjournal communication journal publication and influence across research areas and interdisicplinary borrowing in the first section we describe our data we study interjournal communications by examining the citation patterns of an eight journal set in section ii then in section iii we investigate journal publication and influence by categorizing each journal s articles by research area and by measuring the citation frequency of a journal s articles in individual research areas we also explore the areas of high overall publication interest in section iv we examine the level of interdisciplinary borrowing in finance by categorizing every citation of every article by discipline concluding remarks are in section v

from housing bust to credit crunch evidence from small business loans this paper provides evidence that the 2007 2009 housing bust in the united states precipitated a credit crunch for small businesses to remove demand driven correlations we rely on within city comparisons we ask whether banks whose mortgage portfolios were more heavily weighted in harder hit cities cut back lending to a greater extent in all cities where they make small business loans relative to other banks in those cities the evidence is consistent with a credit crunch large banks reacted with heavier cuts but consistent evidence is also found among smaller banks quantitatively the detected contribution to the overall decline in lending from the crunch appears modest resume effondrement du marche immobilier et contraction du credit resultats derives des prets aux petites entreprises ce texte montre que l effondrement du marche immobilier aux etats unis en 2007 2009 a precipite une contraction du credit pour les petites entreprises pour eliminer les correlations en provenance de la demande on s en tient des comparaisons a l interieur de memes villes on se demande si les banques dont les portefeuilles d hypotheques etaient davantage plombes par les villes les plus durement touchees ont sabre dans les prets aux petites entreprises dans toutes les villes dans lesquelles elles operaient que les autres banques qui operaient dans ces villes les resultats sont coherents avec l idee d une contraction du credit les grandes banques ont reagi avec des contractions plus fortes mais les petites banques ont reagi aussi dans le meme sens quantitativement la contribution au declin total des prets dans la contraction du credit parait modeste

interbank contagion at work evidence from a natural experiment this article tests financial contagion due to interbank linkages for identification we exploit an idiosyncratic sudden shock caused by a large bank failure in conjunction with detailed data on interbank exposures first we find robust evidence that higher interbank exposure to the failed bank leads to large deposit withdrawals second the magnitude of contagion is higher for banks with weaker fundamentals third interbank linkages among surviving banks further propagate the shock finally we find results suggesting that there are real economic effects these results suggest that interbank linkages act as an important channel of contagion and hold important policy implications jel g01 g21 g28 e58 since the onset of the financial turmoil increased uncertainty reflected particularly in counterparty risk has led banks to hoard liquidity this has resulted in a significant decline of trading in the interbank money markets jean claude trichet president of the european central bank december 2008

reduced cross border lending and financing costs of smes abstract this paper investigates how the withdrawal of banks from their cross border business impacted the borrowing costs of european firms since the crisis we combine aggregate information on total and cross border credit with firm level survey data for the period 2010 2014 we find that the decline in cross border lending led to a deterioration in the borrowing conditions of small firms in countries with more pronounced reductions in cross border credit inflows the likelihood of a rise in firms external financing costs increased this result is mainly driven by the interbank channel which plays a crucial role in transmitting shocks to the real sector across borders