A Capital Structure Channel of Monetary Policy
Benjamin Grosse-Rueschkamp, Sascha Steffen, Daniel Streitz
Journal of Financial Economics,
No. 2,
2019
Abstract
We study the transmission channels from central banks’ quantitative easing programs via the banking sector when central banks start purchasing corporate bonds. We find evidence consistent with a “capital structure channel” of monetary policy. The announcement of central bank purchases reduces the bond yields of firms whose bonds are eligible for central bank purchases. These firms substitute bank term loans with bond debt, thereby relaxing banks’ lending constraints: banks with low tier-1 ratios and high nonperforming loans increase lending to private (and profitable) firms, which experience a growth in investment. The credit reallocation increases banks’ risk-taking in corporate credit.
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Managerial Biases and Debt Contract Design: The Case of Syndicated Loans
Tim R. Adam, Valentin Burg, Tobias Scheinert, Daniel Streitz
Management Science,
No. 1,
2020
Abstract
We examine whether managerial overconfidence impacts the use of performance-pricing provisions in loan contracts (performance-sensitive debt [PSD]). Managers with biased views may issue PSD because they consider this form of debt to be mispriced. Our evidence shows that overconfident managers are more likely to issue rate-increasing PSD than regular debt. They choose PSD with steeper performance-pricing schedules than those chosen by rational managers. We reject the possibility that overconfident managers have (persistent) positive private information and use PSD for signaling. Finally, firms seem to benefit less from using PSD ex post if they are managed by overconfident rather than rational managers.
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Das Potenzial von Bankkreditspreads für die Konjunkturprognose
Daniel Streitz
Wirtschaft im Wandel,
No. 2,
2022
Abstract
Prognosemodelle für die zukünftige wirtschaftliche Entwicklung verwenden häufig marktbasierte Indikatoren wie Spreads von Unternehmensanleihen, die den Risikoaufschlag gegenüber einem Referenzzins angeben. Anleihespreads bilden jedoch nur die Entwicklung von Risiken für Unternehmen ab, die regelmäßig Anleihen emittieren – im Durchschnitt größere, sichere Firmen. Neuartige Daten zu Bankkrediten, die im Sekundärmarkt gehandelt werden, erlauben auch die Konstruktion von Kreditspreads. Kreditmarktdaten umfassen ein breiteres Spektrum an Firmen, inklusive kleinerer Firmen, die stärker von Finanzmarktfriktionen betroffen sind. Tests zeigen, dass Kreditspreads tatsächlich mehr Informationen über wirtschaftliche Entwicklungen beinhalten als Anleihespreads und daher das Potenzial haben, Prognosemodelle zu verbessern.
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Corporate Loan Spreads and Economic Activity
Anthony Saunders, Alessandro Spina, Sascha Steffen, Daniel Streitz
SSRN Working Paper,
2021
Abstract
We use secondary corporate loan-market prices to construct a novel loan-market-based credit spread. This measure has considerable predictive power for economic activity across macroeconomic outcomes in both the U.S. and Europe and captures unique information not contained in public market credit spreads. Loan-market borrowers are compositionally different and particularly sensitive to supply-side frictions as well as financial frictions that emanate from their own balance sheets. This evidence highlights the joint role of financial intermediary and borrower balance-sheet frictions in understanding macroeconomic developments and enriches our understanding of which type of financial frictions matter for the economy.
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Capital Misallocation and Innovation
Christian Schmidt, Yannik Schneider, Sascha Steffen, Daniel Streitz
SSRN Solutions Research Paper Series,
2020
Abstract
This paper documents that "zombie" lending by undercapitalized banks distorts competition and impedes corporate innovation. This misallocation of capital prevents both the exit of zombie and entry of healthy firms in affected industries adversely impacting output and competition. Worse, capital misallocation depresses patent applications, particularly in high technology- and R&D-intensive sectors, and industries with neck- and-neck competition. We strengthen our results using an IV approach to address reverse causality and innovation survey data from the European Commission. Overall, our results are consistent with externalities imposed on healthy firms through the misallocation of capital.
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Banking Market Deregulation and Mortality Inequality
Iftekhar Hasan, Thomas Krause, Stefano Manfredonia, Felix Noth
Bank of Finland Research Discussion Papers,
No. 14,
2022
Abstract
This paper shows that local banking market conditions affect mortality rates in the United States. Exploiting the staggered relaxation of branching restrictions in the 1990s across states, we find that banking deregulation decreases local mortality rates. This effect is driven by a decrease in the mortality rate of black residents, implying a decrease in the black-white mortality gap. We further analyze the role of mortgage markets as a transmitter between banking deregulation and mortality and show that households' easier access to finance explains mortality dynamics. We do not find any evidence that our results can be explained by improved labor outcomes.
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Stellungnahme „Übergreifende Kostenbetrachtung der Auswirkungen des Klimawandels in Schleswig-Holstein“
Katja Heinisch, Oliver Holtemöller, Christoph Schult
IWH Policy Notes,
No. 1,
2023
Abstract
anlässlich der Anhörung im Umwelt- und Agrarausschuss des Schleswig-Holsteinischen Landtags ‒ Antrag der Fraktion der SPD, Drucksache 20/414
Der Klimawandel in Schleswig-Holstein führt zu Veränderungen in Umwelt, Wirtschaft und Arbeitswelt, und er hat Auswirkungen auf die Gesundheit der Menschen. Der wissenschaftliche Konsens geht davon aus, dass die sozioökonomischen und ökologischen Effekte des Klimawandels weltweit überwiegend negativ sein werden. Aus diesem Grund schreibt das Klimaschutzgesetz vor, dass die deutschen Treibhausgasemissionen bis zum Jahr 2030 um mindestens 65% und bis zum Jahr 2040 um mindestens 88% reduziert werden sollen; bis zum Jahr 2045 soll Klimaneutralität in Deutschland erreicht werden. Schleswig-Holstein hat eigene Klimaschutzziele und Maßnahmen eingeführt. Unsicherheiten bestehen jedoch hinsichtlich der nationalen und regionalen Kosten des Klimawandels. Bisherige Studien deuten darauf hin, dass in der zweiten Hälfte des
21. Jahrhunderts in Deutschland die jährlichen Verluste des Bruttoinlandsprodukts unter einem Prozent liegen werden. Zur Plausibilisierung dieser Zahl ist es notwendig, eine transparente und replizierbare Klimawandelfolgenabschätzung für Schleswig-Holstein vorzunehmen. Es wird daher empfohlen, dem Antrag zuzustimmen.
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Forced Displacement, Exposure to Conflict and Long-run Education and Income Inequality: Evidence from Croatia and Bosnia and Herzegovina
Adnan Efendic, Dejan Kovač, Jacob N. Shapiro
Abstract
This paper investigates the long-term relationship between conflict-related migration and individual socioeconomic inequality. Looking at the post-conflict environments of Bosnia and Herzegovina (BiH) and Croatia, the two former Yugoslav states most heavily impacted by the conflicts of the early 1990s, the paper focuses on differences in educational performance and income between four groups: migrants, internally displaced persons, refugees, and those who did not move two decades after the conflicts. For BiH, the analysis leverages a municipality-representative survey (n = 6, 021) that captured self-reported education and income outcomes as well as migration histories. For Croatia, outcomes are measured using an anonymized education registry that captured outcomes for over half a million individuals over time. This allows an assessment of convergence between different categories of migrants. In both countries, individuals with greater exposure to conflict had systematically worse educational performance. External migrants now living in BiH have better educational and economic outcomes than those who did not migrate, but these advantages are smaller for individuals who were forced to move. In Croatia, those who moved during the conflict have worse educational outcomes, but there is a steady convergence between refugees and non-migrants. This research suggests that policies intended to address migration-related discrepancies should be targeted on the basis of individual and family experiences caused by conflict.
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IWH-Flash-Indikator I. Quartal und II. Quartal 2023
Katja Heinisch, Oliver Holtemöller, Axel Lindner, Birgit Schultz
IWH-Flash-Indikator,
No. 1,
2023
Abstract
Im vierten Quartal 2022 ging die Wirtschaftsleistung in Deutschland um 0,2% zurück. Insbesondere die privaten Haushalte erfüllten sich aufgrund der hohen Inflation weniger Konsumwünsche als noch im Quartal zuvor. Die Unterstützung seitens des Staates bei den hohen Energiepreisen federn die gestiegenen Lebenshaltungskosten der privaten Haushalte nur teilweise ab. Diese Kaufkraftverluste werden die Konsumenten wohl noch einige Zeit belasten. Die Unternehmen wurden hingegen bereits von den gesunkenen Beschaffungskosten auf den Weltmärkten etwas entlastet, und auch die Lieferkettenprobleme gingen zuletzt zurück. Allerdings trüben zahlreiche Krisenherde weltweit die Aussichten der deutschen Wirtschaft erneut ein. Zwar kommt es laut IWH-Flash-Indikator im ersten Quartal 2023 zu einer kurzen vorübergehenden Aufhellung, und die deutsche Wirtschaft legt um 0,5% zu. Jedoch schon im zweiten Quartal dürfte sich der Abwärtstrend mit einem Rückgang des Bruttoinlandsprodukts (BIP) um 0,3% fortsetzen (vgl. Abbildung 1).
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Measuring the Impact of Household Innovation using Administrative Data
Javier Miranda, Nikolas Zolas
NBER Working Paper,
No. 25259,
2018
Abstract
We link USPTO patent data to U.S. Census Bureau administrative records on individuals and firms. The combined dataset provides us with a directory of patenting household inventors as well as a time-series directory of self-employed businesses tied to household innovations. We describe the characteristics of household inventors by race, age, gender and U.S. origin, as well as the types of patented innovations pursued by these inventors. Business data allows us to highlight how patents shape the early life-cycle dynamics of nonemployer businesses. We find household innovators are disproportionately U.S. born, white and their age distribution has thicker tails relative to business innovators. Data shows there is a deficit of female and black inventors. Household inventors tend to work in consumer product areas compared to traditional business patents. While patented household innovations do not have the same impact of business innovations their uniqueness and impact remains surprisingly high. Back of the envelope calculations suggest patented household innovations granted between 2000 and 2011 might generate $5.0B in revenue (2000 dollars).
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