Files and links (1)
SubmittedOpen Access (License Unspecified), Open
Journal article
Relationship Networks in Banking Around a Sovereign Default and Currency Crisis
IMF economic review, v 68(3), pp 584-642
01 Sep 2020
Featured in Collection : UN Sustainable Development Goals @ Drexel
Abstract
We study how banks' exposure to a sovereign crisis gets transmitted onto the corporate sector. To do so, we use data on the universe of banks and firms in Argentina during the crisis of 2001. We build a model characterized by matching frictions in which firms establish (long-term) relationships with banks that are subject to balance sheet disruptions. Credit relationships with banks more exposed to the crisis suffer the most. However, this relationship-level effect overstates the true cost of the crisis since profitable firms (e.g., exporters after a devaluation) might find it optimal to switch lenders, reducing the negative impact on overall credit and activity. Using linked bank-firm and firm-level data, we find evidence largely consistent with our theory.
Metrics
Details
- Title
- Relationship Networks in Banking Around a Sovereign Default and Currency Crisis
- Creators
- Pablo D'Erasmo - Federal Reserve Bank of PhiladelphiaHernan Moscoso Boedo - University of Cincinnati Medical CenterMaria Pia Olivero - Drexel UniversityMaximo Sangiacomo - Central Bank of Argentina
- Publication Details
- IMF economic review, v 68(3), pp 584-642
- Publisher
- Springer Nature
- Number of pages
- 59
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Economics (School of Economics)
- Web of Science ID
- WOS:000534696200001
- Scopus ID
- 2-s2.0-85085353197
- Other Identifier
- 991019170853604721
UN Sustainable Development Goals (SDGs)
This publication has contributed to the advancement of the following goals:
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Business, Finance
- Economics