On Saturday 11 May, the Centre for Economic Policy Research (CEPR) published an article by Marie Alder, Nuno Coimbra and Urszula Szczerbowicz: using French data, it examines the implications of firms’ debt structure on the transmission of monetary policy to investment.
In their conclusions, the authors highlight the asymmetric impact of the various monetary policy tools on business investment, depending on whether companies are more reliant on bank loans or capital markets for their financing.
The authors use this to point out that the tightening of qualifications may have a greater impact on investments made by large non-financial companies, which benefit from better access to capital markets. On the other hand, a conventional tightening would have a greater impact on smaller companies, which are more dependent on bank loans.
Marie Alder, Nuno Coimbra and Urszula Szczerbowicz note that the policy could be more targeted when there are specific issues linked to one of these types of funding.
Link to the paper: https://aeur.eu/f/c62 (Original version in French by Émilie Vanderhulst)