IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Regulation Policy And Credit Crunch: Evidence From Japan

  • Guizani, Brahim

This paper aims to answer the following question: what is (are) the cause(s) of the severe reduction in bank credits in Japan between 1999 and 2005? The answer to this question becomes very interesting if we know that during the above mentioned period an ultra–expansionary monetary policy has been implemented by the Bank of Japan. A theoretical lending–supply model is built. The methodological contribution of this work stands on the test of three credit crunch–hypotheses, all together. The estimation results show that during the period of study a credit crunch was, indeed, taking place and it is attributed to bankers’ precautionary behavior rather than direct regulatory capital worries. The strengthening of the regulatory environment started in 1998 can explain the conservative lending behavior of Japanese banks during the period of study.

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://mpra.ub.uni-muenchen.de/46827/1/MPRA_paper_46827.pdf
File Function: original version
Download Restriction: no

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 46827.

as
in new window

Length:
Date of creation: 01 May 2010
Date of revision: 08 May 2013
Handle: RePEc:pra:mprapa:46827
Contact details of provider: Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
Web page: http://mpra.ub.uni-muenchen.de

More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Noriko Inakura & Satoshi Shimizutani & Ralph Paprzycki, 2005. "Deposit Insurance and Depositor Discipline: Direct Evidence on Bank Switching Behavior in Japan," Hi-Stat Discussion Paper Series d05-125, Institute of Economic Research, Hitotsubashi University.
  2. Heather Montgomery & Satoshi Shimizutani, 2005. "The Effectiveness of Bank Recapitalization in Japan," Hi-Stat Discussion Paper Series d05-105, Institute of Economic Research, Hitotsubashi University.
  3. Allen N. Berger & Gregory F. Udell, 1994. "Did risk-based capital allocate bank credit and cause a "credit crunch" in the United States?," Proceedings, Federal Reserve Bank of Cleveland, pages 585-633.
  4. Dixit, Avinash K., 1990. "Optimization in Economic Theory," OUP Catalogue, Oxford University Press, edition 2, number 9780198772101, March.
  5. Joe Peek & Eric S. Rosengren, 1995. "Bank regulatory agreements in New England," New England Economic Review, Federal Reserve Bank of Boston, issue May, pages 15-24.
  6. Joe Peek & Eric S. Rosengren, 1996. "Bank Regulatory Agreements and Real Estate Lending," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 24(1), pages 55-73.
  7. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-54, July.
  8. Arellano, Manuel, 2003. "Panel Data Econometrics," OUP Catalogue, Oxford University Press, number 9780199245291, March.
  9. Imai, Masami, 2006. "Market discipline and deposit insurance reform in Japan," Journal of Banking & Finance, Elsevier, vol. 30(12), pages 3433-3452, December.
  10. Joe Peek & Eric Rosengren, 1991. "The capital crunch: neither a borrower nor a lender be," Working Papers 91-4, Federal Reserve Bank of Boston.
  11. Montgomery, Heather, 2005. "The effect of the Basel Accord on bank portfolios in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 19(1), pages 24-36, March.
  12. Keiko Murata & Masahiro Hori, 2006. "Do Small Depositors Exit From Bad Banks? Evidence From Small Financial Institutions In Japan," The Japanese Economic Review, Japanese Economic Association, vol. 57(2), pages 260-278.
  13. Wolfson, Martin H, 1996. "Irving Fisher's Debt-Deflation Theory: Its Relevance to Current Conditions," Cambridge Journal of Economics, Oxford University Press, vol. 20(3), pages 315-33, May.
  14. Wako Watanabe, 2007. "Prudential Regulation and the "Credit Crunch": Evidence from Japan," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 39(2-3), pages 639-665, 03.
  15. Ray Owens, 1991. "Credit crunch?," Cross Sections, Federal Reserve Bank of Richmond, issue Win, pages 1-3.
  16. Joe Peek & Eric S. Rosengren, 1996. "The international transmission of financial shocks: the case of Japan," Working Papers 96-1, Federal Reserve Bank of Boston.
  17. Shrieves, Ronald E. & Dahl, Drew, 1992. "The relationship between risk and capital in commercial banks," Journal of Banking & Finance, Elsevier, vol. 16(2), pages 439-457, April.
  18. Orgler, Yair E & Taggart, Robert A, Jr, 1983. "Implications of Corporate Capital Structure Theory for Banking Institutions: A Note," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 15(2), pages 212-21, May.
  19. Yair E. Orgler & Robert A. Taggart, Jr., 1981. "Implications of Corporate Capital Structure Theory for Banking Institutions," NBER Working Papers 0737, National Bureau of Economic Research, Inc.
  20. John Wagster, 1999. "The Basle Accord of 1988 and the International Credit Crunch of 1989–1992," Journal of Financial Services Research, Springer, vol. 15(2), pages 123-143, March.
  21. Blackwell, Norman R. & Santomero, Anthony M., 1982. "Bank credit rationing and the customer relation," Journal of Monetary Economics, Elsevier, vol. 9(1), pages 121-129.
  22. Stanhouse, Bryan E., 1983. "Stochastic reserve losses, bank credit expansion and Bayesian information," Journal of Monetary Economics, Elsevier, vol. 12(2), pages 321-330.
  23. Saunders, Anthony & Strock, Elizabeth & Travlos, Nickolaos G, 1990. " Ownership Structure, Deregulation, and Bank Risk Taking," Journal of Finance, American Finance Association, vol. 45(2), pages 643-54, June.
Full references (including those not matched with items on IDEAS)

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:pra:mprapa:46827. 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: (Ekkehart Schlicht)

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.