Banks' regulatory buffers, liquidity networks and monetary policy transmission

Based on a quarterly regulatory dataset for German banks from 1999 to 2004, this paper analyzes the effects of banks' regulatory capital on the transmission of monetary policy in a system of liquidity networks. The dynamic panel regression results provide evidence in favor of the bank capital channel theory. Banks holding less regulatory capital and less interbank liquidity react more restrictively to a monetary tightening than their peers.

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Year of publication:	2006
Authors:	Merkl, Christian ; Stolz, Stéphanie
Publisher:	Kiel : Kiel Institute for the World Economy (IfW)
Subject:	Transmissionsmechanismus \| Bank \| Eigenkapital \| Bankenliquidität \| Schätzung \| Deutschland \| Bank lending channel \| Bank capital channel \| Liquidity networks \| Monetary policy transmission

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Series:	Kiel Working Paper ; 1303
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	52010109X [GVK] hdl:10419/3916 [Handle] RePEc:zbw:ifwkwp:1303 [RePEc]
Classification:	E52 - Monetary Policy (Targets, Instruments, and Effects) ; G21 - Banks; Other Depository Institutions; Mortgages ; G28 - Government Policy and Regulation ; C23 - Models with Panel Data
Source:	EconStor

Persistent link: https://www.econbiz.de/10010277973