Chava, Sudheer; Purnanandam, Amiyatosh - In: Journal of Financial Economics 99 (2011) 1, pp. 116-135
We provide causal evidence that adverse capital shocks to banks affect their borrowers' performance negatively. We use an exogenous shock to the U.S. banking system during the Russian crisis of Fall 1998 to separate the effect of borrowers' demand of credit from the supply of credit by the...