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Bi-directional Causality between Firm and Household Credit: The Eurozone and Venezuelan cases

Author

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  • Juan Carlos Guevara Guevara

    (Instituto de Investigaciones Económicas y Sociales. Universidad Católica Andrés Bello (UCAB). Caracas, Venezuela.)

Abstract

Over a century, the academy has been unsuccessful in reaching an agreement over the effect of credit on economic growth. Probably this is the result of analyzing total credit rather than its component. In the present study, the independent effects of firm and household credits over economic growth are examined and, through a partial equilibrium model, we conclude that household credit effect is neutral unless it is anticipated by firm credit. Additionally, cointegration analysis applied to Eurozone countries and Venezuela, identifies bi-directional causality between both types of credit.

Suggested Citation

  • Juan Carlos Guevara Guevara, 2015. "Bi-directional Causality between Firm and Household Credit: The Eurozone and Venezuelan cases," Economía, Instituto de Investigaciones Económicas y Sociales (IIES). Facultad de Ciencias Económicas y Sociales. Universidad de Los Andes. Mérida, Venezuela, vol. 40(39), pages 73-118, January-J.
    • Handle: RePEc:ula:econom:v:40:y:2015:i:39:p:73-118
    as

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    References listed on IDEAS

    as
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    2. Milton Friedman, 1957. "Introduction to "A Theory of the Consumption Function"," NBER Chapters, in: A Theory of the Consumption Function, pages 1-6, National Bureau of Economic Research, Inc.
    3. Milton Friedman, 1957. "A Theory of the Consumption Function," NBER Books, National Bureau of Economic Research, Inc, number frie57-1, March.
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    More about this item

    Keywords

    Bi-directional Causality; Credit and Economic Growth; Eurozone; Venezuela.;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers

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