Publication detail

Financial Accelerator Effects in the Balance Sheets of Czech Firms

Author(s): prof. Roman Horváth Ph.D.,
Type: IES Working Papers
Year: 2005
Number: 96
Published in: IES WP 2005/96
Publishing place: Prague
Keywords: Monetary policy transmission, interest rates, balance sheet channel, financial accelerator
JEL codes: G11, G32
Suggested Citation:
Grants: IES Research Framework Institutional task (2005-2011) Integration of the Czech economy into European union and its development
Abstract: In this paper we examine a financial accelerator hypothesis analyzing the determinants of firm-level interest rates. Using a panel of the financial statements of 448 Czech firms in 1996-2002, we find that firm’s balance sheet indicators are important determinant for firm-level interest rates. Indebtness and market access matter in particular. The strength of balance sheets is procyclical. There is also evidence that monetary policy has stronger effects on small firms and during a period of excess demand for credit.
Downloadable: WP 2005_96 Horvath


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