Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5098466 | Journal of Economic Dynamics and Control | 2014 | 27 Pages |
Abstract
We study how a bank credit crunch-a dramatic worsening of firm and consumer access to bank credit, such as the one observed over the Great Recession-translates into job losses in U.S. manufacturing industries. To identify the impact of the recent credit crunch, we rely on differences in the degree of dependence on external finance and of tangibility of assets across manufacturing industries and in the sensitivity of these industries׳ output to changes in the supply of consumer credit. We find that, for employment, household access to bank loans matters more than firm access to bank loans. In addition, we show that, over the recent financial crisis, tightening access to commercial and industrial loans and, in particular, consumer installment loans may have contributed significantly to the drop in employment in the manufacturing sector.
Related Topics
Physical Sciences and Engineering
Mathematics
Control and Optimization
Authors
Samuel Haltenhof, Seung Jung Lee, Viktors Stebunovs,