• Corpus ID: 52846792

Do Government Guarantees of Bank Loans Lower , or Raise , Banks ’ Nonguaranteed Lending ?

@inproceedings{Wilcox2018DoGG,
  title={Do Government Guarantees of Bank Loans Lower , or Raise , Banks ’ Nonguaranteed Lending ?},
  author={James Allen Wilcox and Haas},
  year={2018}
}
The government vastly increased loan guarantees and capital injections for banks during the late-1990s crisis in Japan. We model when loan guarantees would raise, or lower, nonguaranteed lending. We found that nonguaranteed loans to small businesses rose by more than guaranteed loans rose. We also found that capital, which was injected only into the largest banks, was associated with significant increases in their lending. Thus, both the capital injections and the “synthetic capital” generated… 

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