Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/222281
Authors: 
Huremovic, Kenan
Jiménez, Gabriel
Moral-Benito, Enrique
Vega-Redondo, Fernando
Peydró, José-Luis
Year of Publication: 
2020
Abstract: 
We show that bank shocks originating in the fi nancial sector propagate upstream and downstream along the production network and triple the impact of direct bank shocks. Our identi fication relies on the universe of both supplier-customer transactions and bank loans in Spain, a standard operationalization of credit-supply shocks during the 2008-09 global crisis, and the proposed theoretical framework. The impact on real effects is strong, and similarly so, when considering: (i) direct bank shocks to firms versus fi rst-order inter firm contagion; (ii) first-order versus higher-order network effects; (iii) downstream versus upstream propagation; (iv) firm-speci fic versus economy-wide shocks. Market concentration ampli fies these effects.
Subjects: 
networks
supply chains
shock propagation
credit supply
real effects of finance
JEL: 
D85
E44
E51
G01
G21
Document Type: 
Working Paper

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