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Capital Flows and the International Credit Channel

Author

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  • Baskaya, Yusuf Soner
  • Di Giovanni, Julian
  • Kalemli-Ozcan, Sebnem
  • Peydró, José-Luis
  • Ulu, Mehmet Fatih
Abstract
We examine the role of the international credit channel in Turkey over 2005–2013. We show that larger, more capitalized banks with higher non-core liabilities increase credit supply when capital inflows are higher. This result is stronger for domestic banks relative to foreign banks and survives during the crisis period of post-2008, when foreign banks in general stop lending in emerging markets and retreat to their home countries. By decomposing capital inflows into bank and non-bank flows, we show the importance of domestic banks' external borrowing for domestic credit growth.

Suggested Citation

  • Baskaya, Yusuf Soner & Di Giovanni, Julian & Kalemli-Ozcan, Sebnem & Peydró, José-Luis & Ulu, Mehmet Fatih, 2017. "Capital Flows and the International Credit Channel," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 108, pages 15-22.
    • Handle: RePEc:zbw:espost:216782
    DOI: 10.1016/j.jinteco.2016.12.003
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    capital flows; bank-lending channel; bank heterogeneity;
    All these keywords.

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • F0 - International Economics - - General
    • F1 - International Economics - - Trade

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