Credit expansion, bank liberalization, and structural change in bank asset accounts

• Published in: Journal of economic dynamics & control Vol. 124; p. 104066
• Main Authors: Liu, Keqing, Fan, Qingliang
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01.03.2021
• Subjects: Bank balance sheet; Bank liberalization; Business cycle; Credit expansion; Bank balance sheet; Business cycle; Credit expansion; Bank liberalization
• ISSN: 0165-1889; 1879-1743
• DOI: 10.1016/j.jedc.2021.104066

This paper studies the links among credit supply expansion, commercial bank asset account structures, and the housing boom preceding the 2007–2009 financial crisis. We propose a real business cycle model with a housing market and financial intermediaries (banks) subject to leverage constraints. In o...