Monetary policy transmission in unconventional times: The role of financial structure
Bibliographic record
Abstract
This thesis presents empirical work on the lending channel of monetary policy and the role of financial structure in Europe. Europe's financial structure is heavily bank-based, which has implications for the transmission of monetary policy. The bias towards banks prompted the Eurosystem to implement several credit easing and liquidity supporting measures in the wake of the Great Financial Crisis of 2008. Have these measures helped to sustain the flow of finance to the real economy? In short, this thesis finds the answer is yes. Using confidential monetary data, the results of this research suggest that the Eurosystem has effectively buttressed the intermediary function of the European financial system. But this thesis also shows that there are lessons to be drawn. First, looking forward to what is likely to be a prolonged period of negative interest rates, the Eurosystem may minimize the distortive effects of monetary policy stimulus on bank performance by specifically targeting longer-term interest rates. Second, ambitious price incentives embedded in the monetary operations can further incentivize banks to increase lending while preventing a dependence on central bank funding. Last, to better foster the flow of finance in adverse circumstances, Europe needs a more diverse financial structure. Stimulating debt creation and risk taking by banks increases the risk of financial instability in Europe's bank-based financial system, because bank-based financial structures are found to be associated with more systemic risk than market-based financial structures.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.010 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.001 | 0.001 |
| Science and technology studies | 0.001 | 0.002 |
| Scholarly communication | 0.006 | 0.004 |
| Open science | 0.000 | 0.001 |
| Research integrity | 0.001 | 0.001 |
| Insufficient payload (model declined to judge) | 0.005 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".