interest, so an economy is much closer to the ZLB. However, an unconventional credit policy, that consists on central bank … the economy from reaching the ZLB. Since central bank loans are not subject to the moral hazard problem between bankers … reduced due to a relatively stronger inflation reduction, which in turn reduces entrepreneurs' incentives to demand bank loans. …

effects of asymmetric information. Third, using data for firms that maintain multiple bank relationships, we obtain … characterised by a limited commitment to exert costly monitoring by the bank …