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Journal Article
Money, interest rates and economic activity: stylized facts for Japan
This paper examines how financial market changes affect the usefulness of two alternatve indicators of monetary policy in Japan, a monetary aggregate and an interest rate. The paper tests whether these variables are good predictors of output, and whether responses to shocks to these variables broadly conform to the implications of the monetary transmission model, over two periods between 1960 and 1992. In the earlier period when Japan's financial markets were less developed, a monetary aggregate (M2+CDs) is a relatively useful indicator of monetary policy whereas an interest rate ...
Journal Article
Financial regulation and banking sector performance: a comparison of bad loan problems in Japan and Korea
We estimate the bad loan rate in Japan and Korea for 1973-1992 using data on defaults on notes issued by the corporate sector. This method exploits institutional features common in both countries which suggest a close linkage between default on notes and default on bank borrowing. Our main findings are as follows. First, the pattern of the estimated bad loan rate series generally conforms to past business cycle patterns in both countries. Second, the bad loan rate is substantially higher in Korea than Japan. Lastly, a much tighter linkage is observed for Japan between the bad loan rate ...
Journal Article
Do capital controls affect the response of investment to saving? evidence from the Pacific Basin
This paper examines the effect of capital controls on the response of investment to savings in Pacific Basin countries. A robust finding is that the size of the savings coefficient tends to be smaller (larger) in countries with relatively higher (lower) capital controls. Additionally, relaxation in capital controls for the most part had no discernible impact on the savings- investment relationship in individual country time-series regressions. At least a partial resolution to these puzzles is found in the government policy response: Countries with a relatively high saving-investment ...
Journal Article
Stock prices and bank lending behavior in Japan
This study attempts to shed light on whether stock price movements have contributed to recent fluctuations in bank lending in Japan by examining the historical relationship between stock prices and bank lending in that country. It is found that prior to the mid-1980s the relationship between stock prices and bank lending was weak, but subsequently strengthened considerable. This coincided with a change in the regulatory environment that encouraged banking institutions to pay more attention to their capital positions. Since the late 1980s, fluctuations in stock prices appear to have made ...
Journal Article
The use of equity positions by banks: the Japanese evidence
Journal Article
How bad is the \\"bad loan problem\\" in Japan?
Journal Article
Measuring the cost of \\"financial repression\\"
Journal Article
The independence of central banks