Financial Pressure, Monetary Policy Effects and Inventories

Firm‐level Evidence from a Market‐based and a Bank‐based Financial System

Dados Bibliográficos

ID9727124
AutoresANDREW BENITO (Bank of England, autor correspondente)
Ano2005
Volume72
Fascículo286
Páginas201-224
Data de publicação2005-05-01
Peer ReviewedSim
Open AccessSim
TipoARTICLE
PeriódicoEconomica (JOURNAL)
Identificadores do periódicoISSN: 0013-0427 • E-ISSN: 1468-0335
EditoraWiley (PUBLISHER • GB)
DOI10.1111/j.0013-0427.2005.00411.x
OpenAlexW2016608492
IdiomaEN
Citações recebidas6
Referências citadas29

This paper examines the adjustment of inventories by firms in the United Kingdom and Spain, which have two quite different financial systems. A widely held view is that a key channel for monetary policy is through the influencing of inventory accumulation. Using a large company‐level panel data‐set for both countries, significant effects associated with borrowing costs on inventories are estimated. Financial effects associated with liquidity and the borrowing ratio are estimated to be stronger in the UK than in Spain. Since the Spanish financial system is bank‐based, while that of the UK is market‐based, this is interpreted as contrary to the Bank Dependence Hypothesis

Business · Economics · Financial market · Financial system · Market liquidity · Monetary economics · Monetary policy · Panel data · Banking stability, regulation, efficiency · Corporate Finance and Governance · Finance · Monetary Policy and Economic Impact

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