Abstract
This paper studies how the process of reallocation of credit across firms behaves before and after financial crises. Applying the methodology typically used for measuring job reallocation, we track credit reallocation across Korean firms for over three decades (1980–2012). The credit boom preceding the 1997 crisis featured a slowdown of credit reallocation. After the crisis and the associated reforms, the creditless recovery (deleveraging) masked a dramatic intensification and increased procyclicality of credit reallocation. The findings suggest that the intensification of reallocation was efficiency-enhancing.
Original language | English |
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Pages (from-to) | 1889-1921 |
Number of pages | 33 |
Journal | Journal of Money, Credit and Banking |
Volume | 51 |
Issue number | 7 |
DOIs | |
State | Published - 1 Oct 2019 |
Keywords
- credit growth
- credit reallocation
- E44
- financial crises