Arbeitspapier
Lending to unhealthy firms in Japan during the Lost Decade: Distinguishing between technical and financial health
We investigate the misallocation of credit in Japan associated with banks’ evergreening loans, distinguishing between two types of firm distress: (perhaps temporary) financial distress and technical distress, which reflects weak operational capabilities, as indicated by low total factor productivity. We show that previous evidence related to firms’ financial health is problematic due to the mixing of loan-demand and loan-supply effects. Using a direct measure of operational health, we provide unambiguous, direct evidence of evergreening behavior, as well as confirming evidence based on the relative impacts on subsequent firm viability of loans by bank types with different incentives to evergreen loans.
- Language
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Englisch
- Bibliographic citation
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Series: Working Papers ; No. 16-22
- Classification
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Wirtschaft
Banks; Depository Institutions; Micro Finance Institutions; Mortgages
Financial Markets and the Macroeconomy
Money Supply; Credit; Money Multipliers
- Subject
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total factor productivity
bank lending
Japan
zombie firms
financial crisis
- Event
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Geistige Schöpfung
- (who)
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Chakraborty, Suparna
Peek, Joe
- Event
-
Veröffentlichung
- (who)
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Federal Reserve Bank of Boston
- (where)
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Boston, MA
- (when)
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2016
- Handle
- Last update
-
10.03.2025, 11:44 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Chakraborty, Suparna
- Peek, Joe
- Federal Reserve Bank of Boston
Time of origin
- 2016
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