NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

What Do a Million Banks Have to Say About the Transmission of Monetary Policy?

Anil K Kashyap, Jeremy C. Stein

NBER Working Paper No. 6056
Issued in June 1997
NBER Program(s):   CF   EFG   ME

In an effort to shed new light on the monetary transmission mechanism, we create a panel data set that includes quarterly observations of every insured commercial bank in the United States over the period 1976-1993. Our key cross-sectional finding is that the impact of monetary policy on lending behavior is significantly more pronounced for banks with less liquid balance sheets -- i.e., banks with lower ratios of cash and securities to assets. Moreover, this result is entirely attributable to the smaller banks in our sample, those in the bottom 95% of the size distribution. Among other things, our findings provide strong support for the existence of a lending channel

download in pdf format
   (584 K)

email paper

A non-technical summary of this paper is available in the December 1997 NBER digest.  You can sign up to receive the NBER Digest by email.

This paper is available as PDF (584 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w6056

Published: Kashyap, Anil K. and Jeremy C. Stein. "What Do A Million Observations On Banks Say About The Transmission Of Monetary Policy?," American Economic Review, 2000, v90(3,Jun), 407-428.

Users who downloaded this paper also downloaded these:
Kashyap and Stein w4821 The Impact of Monetary Policy on Bank Balance Sheets
Kashyap, Stein, and Wilcox w4015 Monetary Policy and Credit Conditions: Evidence From the Composition of External Finance
Kashyap and Stein Monetary Policy and Bank Lending
Bernanke and Gertler w5146 Inside the Black Box: The Credit Channel of Monetary Policy Transmission
Stein w5217 An Adverse Selection Model of Bank Asset and Liability Management with Implications for the Transmission of Monetary Policy
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us