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We analyze the effects of monetary policy on nonbank and bank credit supply to firms and households, in particular the … increase risk-taking in bank loans, we find that higher monetary policy rates lead to an expansion of credit supply and more … borrowers. Second, nonbanks reduce the effectiveness of the bank lending channel of monetary policy at the loan-level. However …
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-regulated, more fragile nonbanks. The bank-to-nonbank shift largely neutralizes total credit and associated consumption effects for …
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We show that nonbanks (funds, shadow banks, fintech) affect the transmission of monetary policy to output, prices and the distribution of risk via credit supply. For identification, we exploit exhaustive US loan-level data since the 1990s, borrowerlender relationships and Gertler-Karadi monetary...
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