between banks and shadow banks based on their funding constraints. Because credit creation by banks responds to economy …-wide productivity endogenously, bank reaction to shocks corresponds to the balance sheet channel. Shadow banks are constrained by their … credit responses. The propagation of real and financial shocks is likewise altered when shadow banks are identified as a …

This paper investigates the risk-taking channel of monetary policy on the asset side of banks' balance sheets. We use a … factor-augmented vector autoregression (FAVAR) model to show that aggregate lending standards of U.S. banks, e.g. their …