The impact of monetary policy and agent heterogeneity on firm financing structure: evidence from the USA Cover Image

The impact of monetary policy and agent heterogeneity on firm financing structure: evidence from the USA
The impact of monetary policy and agent heterogeneity on firm financing structure: evidence from the USA

Author(s): Anna Malinowska
Subject(s): Economy, National Economy, Business Economy / Management
Published by: Uniwersytet Warszawski - Wydział Nauk Ekonomicznych
Keywords: balance sheet channel;LIBOR rate;ZLB;monetary policy;liabilities;corporate debt

Summary/Abstract: Using panel modelling and firm-level data for 222 US listed companies I investigate how changes in monetary policy approximated by the three-month US LIBOR interest rate and its combined effect with firm-specific characteristics influenced firms’ financing decisions and their liability structure during the period 2005−2014. Reported findings suggest that despite the Zero Lower Bound on the Federal Funds Rate, the three-month US LIBOR has retained its impact on firm total debt, long-term bank debt and short-term trade credit. Monetary policy changes were found to have affected firm’s liability structure, especially through parameters such as size, collateral and profitability.

  • Issue Year: 2016
  • Issue No: 46
  • Page Range: 121-142
  • Page Count: 22
  • Language: English