Paper #1730

Título:

Production and financial networks in interplay: Crisis evidence from supplier-customer and credit registers

Autores:

Kenan Huremovic, Jiménez Gabriel, Enrique Moral-Benito, José-Luis Peydró y Fernando Vega-Redondo

Fecha:

Julio 2020

Resumen:

We show that bank shocks originating in the financial sector propagate upstream and downstream along the production network and triple the impact of direct bank shocks. Our identification relies on the universe of both supplier-customer transactions and bank loans in Spain, a standard operationalization of credit-supply shocks during the 2008-09 global crisis, and the proposed theoretical framework. The impact on real effects is strong, and similarly so, when considering: (i) direct bank shocks to firms versus first-order interfirm contagion; (ii) first-order versus higher-order network effects; (iii) downstream versus upstream propagation; (iv) firm-specific versus economy-wide shocks. Market concentration amplifies these effects.

Palabras clave:

networks; supply chains; shock propagation; credit supply; real effects of finance

Códigos JEL:

D85; E44; E51; G01; G21

Área de investigación:

Finanzas y Contabilidad

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