Reluctance to Lend and Its Spatial Differences in Japanfs Lost Decade: What Can We Learn from It?
AbstractThis paper aims to elucidate whether supply side factors played a crucial role in causing the greluctance to lendh in Japan in the 1990s. We estimate loan supply and demand functions using prefectural panel data and calculate their shifts. Our analysis reveals that the demand side played an equal or greater role, even in the context of the historical financial crisis in Japan during the period 1997-2000, and that the reluctance to lend was severer in the urban prefectures. These findings suggest that countermeasures in the banking sector that uniformly influence all regions may not achieve the expected recovery.
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Bibliographic InfoPaper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 08-33-Rev.
Length: 42 pages
Date of creation: Sep 2008
Date of revision: Jan 2011
credit crunch; prefectural panel data; shift of functions; Japanese loan market;
Find related papers by JEL classification:
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
- R51 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Finance in Urban and Rural Economies
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