Header

UZH-Logo

Maintenance Infos

The cleansing effect of banking crises


Gropp, Reint; Ongena, Steven; Rocholl, Jörg; Saadi, Vahid (2022). The cleansing effect of banking crises. Economic Inquiry, 60(3):1186-1213.

Abstract

We assess the cleansing effects of the 2008–2009 financial crisis. U.S. regions with higher levels of supervisory forbearance on distressed banks see less restructuring in the real sector: fewer establishments, firms, and jobs are lost when more distressed banks remain in business. In these regions, the banking sector has been less healthy for several years after the crisis. Regions with less forbearance experience higher productivity growth after the crisis with more firm entries, job creation, and employment, wages, patents, and output growth. Forbearance is greater for state-chartered banks and in regions with weaker banking competition and more independent banks.

Abstract

We assess the cleansing effects of the 2008–2009 financial crisis. U.S. regions with higher levels of supervisory forbearance on distressed banks see less restructuring in the real sector: fewer establishments, firms, and jobs are lost when more distressed banks remain in business. In these regions, the banking sector has been less healthy for several years after the crisis. Regions with less forbearance experience higher productivity growth after the crisis with more firm entries, job creation, and employment, wages, patents, and output growth. Forbearance is greater for state-chartered banks and in regions with weaker banking competition and more independent banks.

Statistics

Citations

Dimensions.ai Metrics
4 citations in Web of Science®
4 citations in Scopus®
Google Scholar™

Altmetrics

Downloads

30 downloads since deposited on 28 Jun 2022
18 downloads since 12 months
Detailed statistics

Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Banking and Finance
Dewey Decimal Classification:330 Economics
Scopus Subject Areas:Social Sciences & Humanities > General Business, Management and Accounting
Social Sciences & Humanities > Economics and Econometrics
Scope:Discipline-based scholarship (basic research)
Language:English
Date:July 2022
Deposited On:28 Jun 2022 07:13
Last Modified:27 Apr 2024 01:38
Publisher:Wiley-Blackwell Publishing, Inc.
ISSN:0095-2583
OA Status:Green
Free access at:Related URL. An embargo period may apply.
Publisher DOI:https://doi.org/10.1111/ecin.13069
Related URLs:https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3650140 (Organisation)
https://www.zora.uzh.ch/id/eprint/197684/
Other Identification Number:merlin-id:22121
  • Content: Accepted Version
  • Language: English