The Federal Reserve Board eagle logo links to home page
Finance and Economics Discussion Series
Finance and Economics Discussion Series logo links to FEDS home page The Effects of Local Banking Market Structure on the Banking-Lending Channel of Monetary Policy
Robert M. Adams and Dean F. Amel

Abstract: We study the relationship between banking competition and the transmission of monetary policy through the bank lending channel. Using business small loan origination data provided from the Community Reinvestment Act from 1996-2002 in our analysis, we are able to reaffirm the existence of the bank lending channel of monetary transmission. Moreover, we find that the impact of monetary policy on loan originations is weaker in more concentrated markets.

Keywords: Competition, monetary policy, lending channel

Full paper (159 KB PDF)

Home | FEDS | List of 2005 FEDS papers
To comment on this site, please fill out our feedback form.
Last update: April 12, 2005