"In this article, we focus on distinguishing between household and corporate sector credit and investigate the effects these two types of credit have on the trade balance. A higher level of private credit indicates better developed financial markets and easier credit access for businesses and households. Yet, both types of borrowers vary in terms of the use of credit. Our model and empirical analysis suggest that the composition of credit does matter for the trade balance: lending to consumers has a negative effect on net exports, while firm loans contribute to a rise in net exports". ("JEL" F32, F41, G21) Copyright (c) 2008 Western Economic Association International.
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Article provided by Western Economic Association International in its journal Economic Inquiry.
Volume (Year): 47 (2009) Issue (Month): 4 (October) Pages: 653-666 Download reference. The following formats are available: HTML
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