This paper uses a unique dataset where credit rejections experienced by euro area firms are matched with firm and bank … characteristics. This allows us to study simultaneously the role that bank and firm weakness had in the credit reduction observed in … the euro area during the sovereign debt crisis, and in credit developments characterising the post-crisis recovery …

activity. Most models share the feature that borrowers suffer a contraction in the quantity of credit. However, the evidence …. This paper reviews both aggregate and micro-level data and highlights the shift in the composition of credit between loans … and bonds. Motivated by the evidence, we formulate a model of direct and intermediated credit that captures the key …