Purpose - This paper examines why farmers self-select out of formal credit markets even though they need external funds. Design/methodology/approach - We use probit and Bayesian probit estimators to detect the determinants of self-selection behavior based on a primary dataset of 2,212 rice...

We investigate the impact of China's 2014 hukou reform - a major change allowing migrants living in small and medium-sized cities of less than 5 million people to apply for urban residence - on formal and informal borrowing at a time of rapid economic transformation. We find that the hukou...

We ask whether imposing fees on redeeming investors can prevent runs on money market mutual funds (MMFs) and related intermediation arrangements. We first show that imposing a fee only in extraordinary times often leaves the fund susceptible to a preemptive run where investors rush to redeem...

Considering refugees' employment challenges in their host countries, they often need to create jobs by starting ventures and embracing self-employment. However, this requires financing. This study seeks to assess the roles of formal and informal financing in self-employment while also looking at...

In Latin America, over 50% of the population has relied on loans from family members or friends, reflecting the importance of trust-based networks in response to financial exclusion. This study examines how distrust in the formal financial system influences the use of informal borrowing. Using...

The global non-bank sector has experienced significant growth since the global financial crisis, raising concerns that this shift represents a financial stability risk. We consider the drivers of this growth in Sweden: a small, open economy whose non-bank sector has grown rapidly. In contrast...

This paper provides an overview of the various financial resources that existed in medieval Tirol to meet financial needs, using notary registers and court records from the 14 th century as sources. These provide ample evidence of an active capital and land market in rural areas, which offered...

This article examines investment opportunities in northern Italian states in the 17th and 18th centuries, with a focus on the private credit market. The research is based on loan contracts drawn up by notaries and on fiscal and administrative documents. Thanks to the service provided by...

Liquidity requirements for commercial banks improve risk-sharing for depositors. Nevertheless, shadow banks, issuing securities with lower liquidity, operate outside such regulatory constraints. In an economy featuring shadow banks with a constant level of liquidity for shadow bank securities,...

This paper studies how Treasury market dynamics depend on adjustments to the central bank balance sheet. We introduce a dynamic model of Treasury bonds with traditional and shadow banks. In the model, both Treasury and repo market disruptions arise as a joint consequence of three frictions: (i)...

Several countries now require banks or money market funds to impose state-contingent costs on shortterm creditors to absorb financial stress. We study these requirements as part of the broader prudential toolkit in a model with five key ingredients: banks may face an aggregate stress state with...

Several countries now require banks or money market funds to impose state-contingent costs on short-term creditors to absorb financial stress. We study these requirements as part of the broader prudential toolkit using a model with five key ingredients: banks may face an aggregate stress state...

We examine households' temporary international migration response when faced with shocks in rural Kyrgyzstan. Using a household fixed effects model, we find that while a drought shock increases migration, a winter shock reduces migration. We argue that this difference is because of the trade-off...

The aim of this study was to ascertain what can be done by the informal finance sector to close the credit gap in order to improve access to finance by SMEs. SMEs are the backbone of many economies as a result of generating employment and improving GDP. Despite playing such a major role in...

Using the exogenous shock of New Asset Management Rules (NAMRs), this paper examines the impact of strengthening passageway business regulation on bank loan financing. We find that since the introduction of the NAMRs, firms that used to adopt passageway financing are obtaining more bank loans....

The impact of microfinance institution (MFIs) activities on household revenue in Northern Ghana is of significant importance, particularly in light of the high levels of poverty in the region. The objective of this research is to explore the factors that influence the amount of loans granted to...

Shadow banking has somewhat compensated for China's lack of formal financial development. However, it may also amplify the financial system's risks, which runs counter to the initial expectation of macroprudential management. With the regulation of shadow banking in China under the New Asset...

We examine how banks manage carbon transition risk by selling loans given to polluting borrowers to less regulated shadow banks in securitization markets. Exploiting the election of Donald Trump as an exogenous shock that reduces carbon risk, we find that banks’ securitization decisions are...

In recent years, assets of nonbank financial intermediaries (NBFIs) have grown significantly relative to those of banks. These two sectors are commonly viewed either as operating in parallel, performing different activities, or as substitutes, performing substantially similar activities, with...

The purpose of this paper is to investigate the role of people's credit banks (BPRs), a predominant form of microfinance in Indonesia, in mitigating poverty. Using panel data from 31 provinces in Indonesia, this study employs static panel and panel models with instrument variables. Our findings...