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...

This paper investigates corporate fixed investment in Hungary between 2001 and 2014 using firm-level data. We analyse the composition, heterogeneity and the drivers of corporate investment. Investments in Hungary are highly concentrated and dominated by large and foreign-owned companies. The...

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...