IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

The Business Cycle, Credit cost and Risk in Chile from a Structural var model's Perspective

Listed author(s):
  • Carlos J. García
  • Andrés Sagner T.

This paper studies the interaction between the economic cycle and the credit market in Chile. The results are obtained with identification of shocks using a structural VAR model that replicates the empirical standard transmission mechanism of monetary policy that has been found in other studies on the Chilean economy. However, our evidence indicates new results. The periods of economic expansion triggers in the long run, first, increases in nonperforming loans, and then credit reductions. Besides, credit market shocks that measure the risk in the sector, non-performing loans (NPL), generate significant aggregate fluctuations in the economy. Similarly, periods of economic contraction, especially characterized by high interest rates, are followed in the medium-term by falling in the non-performing loans and then by credit booms. Finally exogenous shocks of NPLs produce marginal increases in inflation.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://si2.bcentral.cl/public/pdf/revista-economia/2013/abr/recv16n1abr2013pp64-99.pdf
Download Restriction: no

Article provided by Central Bank of Chile in its journal Economía Chilena.

Volume (Year): 16 (2013)
Issue (Month): 1 (April)
Pages: 64-99

as
in new window

Handle: RePEc:chb:bcchec:v:16:y:2013:i:1:p:64-99
Contact details of provider: Postal:
Casilla No967, Santiago

Phone: (562) 670 2000
Fax: (562) 698 4847
Web page: http://www.bcentral.cl/

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:chb:bcchec:v:16:y:2013:i:1:p:64-99. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Claudio Sepulveda)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.