Credit-less Recoveries : Neither a Rare nor an Insurmountable Challenge

Sugawara, Naotaka ; Zalduendo, Juan

World Bank, Washington, DC

关键词: ADVANCED ECONOMIES;    ADVANCED ECONOMY;    AFFILIATED ORGANIZATIONS;    ALTERNATIVE FINANCING;    ARIMA;   

DOI  :  10.1596/1813-9450-6459
RP-ID  :  WPS6459

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper examines why some countriesexperience economic recoveries without pick-up of bankcredit (credit-less) and how different this recovery patternis from the case where credit is increased as an economyrecovers (credit-with). To answer these questions, the paperuses quarterly data covering 96 countries and identifies 272recovery episodes. It finds that more than 25 percent of allrecoveries are credit-less and around 45 percent of allcredit-less recoveries occurred in 2009-10. It also findsthat output and investment growth tends to be lower incredit-less events but, by eight quarters after the troughdate, the gap between credit-less and credit-with episodesis mostly exhausted. Results of the probit estimations showthat the size of the downturn and the extent of externaladjustment are associated with the likelihood of credit-lessrecoveries. Moreover, fiscal loosening tends to be relatedto credit-less events while monetary easing and acountry's decision to seek an International MonetaryFund-supported program reduce the probability of credit-lessrecoveries. Finally, the model suggests that many countriesin the Europe and Central Asia region were likely toexperience credit-less recoveries following the globalfinancial crisis in 2008/09. What is more worrisome for themis the fact that they are facing another negative external shock.