Showing 1 - 7 of 7
The decade preceding the 2008 recession was marked by a rapid rise in household debt in several regions. Strong household lending prior to the recession boosted economic growth in the affected countries, but indebtedness then became one of the main sources of vulnerability of these countries...
Persistent link: https://www.econbiz.de/10010898287
During the crisis, firms saw their profitability deteriorate sharply in the weakening demand environment, which they reacted to by curbing labour costs. Cost-side adjustment thus acted as a buffer against inflationary pressure. In earlier analyses, we investigated this behaviour of firms using...
Persistent link: https://www.econbiz.de/10010898291
The paper investigates the impact of foreign currency lending on investment. Using Hungarian firm level data, we test whether foreign currency lending contributed to larger investment before the crisis and whether the depreciation during the Great Recession resulted in lower investment rate for...
Persistent link: https://www.econbiz.de/10011117804
Our analysis of micro data shows that the size of unhedged foreign currency lending has become significant not just in the household sector, but in the corporate sector as well. The weight of foreign currency debtors without net foreign currency income was significant prior to the crisis. During...
Persistent link: https://www.econbiz.de/10010898286
The paper investigates the impact of foreign currency lending in the Hungarian corporate sector on real investment. Using a rich micro dataset we consider two questions. First we test whether foreign currency (FX) lending – by lowering user cost and easing liquidity constraints – contributed...
Persistent link: https://www.econbiz.de/10010898298
The purpose of our article is to define how the FX debt of the private sector changes the impact of the exchange rate on the real economy: to identify the balance sheet channels through which depreciation of the exchange rate has a negative impact on GDP and the factors which determine whether...
Persistent link: https://www.econbiz.de/10008550298
The aim of this paper is to model the interaction between the loan market and real activity, while financial frictions are explicitly taken into account. The econometric methodology used is VECM. Johansen’s approach is employed to allow for multiple cointegration. Financial frictions are...
Persistent link: https://www.econbiz.de/10009145968