Bank Lending in Turkey: Effects of Monetary and Fiscal Policies

 
Author/Editor: Aydin, Burcu ; Igan, Deniz
 
Publication Date: October 01, 2010
 
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: The period following the 2000-01 crisis was marked by a successful disinflation program sustained through inflation targeting and fiscal discipline in Turkey. This paper studies the impact of monetary and fiscal policies on credit growth during this period. Using quarterly bank-level data covering 2002-08, we find evidence that liquidity-constrained banks have sharper decline in lending during contractionary monetary policies and that crowding-out effect disappears more for banks with a retail-banking focus when fiscal policies are prudent.The results are statistically weak, suggesting that bank lending channel is not strong in Turkey and government finances has limited direct impact on credit.
 
Series: Working Paper No. 10/233
Subject(s): Bank credit | Banking crisis | Banking sector | Credit expansion | Fiscal policy | Loans | Monetary policy | Monetary transmission mechanism | Turkey

Author's Keyword(s): Bank credit | monetary policy | fiscal policy | panel data.
 
English
Publication Date: October 01, 2010
Format: Paper
Stock No: WPIEA2010233 Pages: 33
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
Turkish
Publication Date: February 01, 2011
Format: A web quality merged PDF
Stock No: WPIT2010233 Pages: 31
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
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