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Article: Interest Rate Pass-Through and Consumption Response: The Deposit Channel
Title | Interest Rate Pass-Through and Consumption Response: The Deposit Channel |
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Authors | |
Keywords | Interest Rate Shock Consumption Big Data Household Finance Banking |
Issue Date | 2020 |
Publisher | MIT Press. The Journal's web site is located at http://mitpress.mit.edu/restat |
Citation | The Review of Economics and Statistics, 2020, Epub 2020-06-19 How to Cite? |
Abstract | This study assesses a new mechanism — the deposit channel — in the transmission of interest rate shock to household consumption using an administrative panel dataset of financial transactions for Turkey. Our empirical strategy exploits variation in consumer's adherence to the Muslim laws that forbid earning interest and employs a standard difference-in-difference design. Following an unanticipated announcement of interest rate hike, rate-sensitive consumers significantly reduce their overall spending and the response persists throughout the post-announcement period. The response of debt payment, disparate exposure to inflation, and exchange rate, the demographic difference can hardly fully account for the documented consumption response heterogeneity. |
Persistent Identifier | http://hdl.handle.net/10722/283987 |
ISSN | 2023 Impact Factor: 7.6 2023 SCImago Journal Rankings: 7.553 |
SSRN | |
ISI Accession Number ID |
DC Field | Value | Language |
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dc.contributor.author | Agarwal, S | - |
dc.contributor.author | Chomsisengphet, S | - |
dc.contributor.author | Yildirim, Y | - |
dc.contributor.author | Zhang, J | - |
dc.date.accessioned | 2020-07-20T05:55:07Z | - |
dc.date.available | 2020-07-20T05:55:07Z | - |
dc.date.issued | 2020 | - |
dc.identifier.citation | The Review of Economics and Statistics, 2020, Epub 2020-06-19 | - |
dc.identifier.issn | 0034-6535 | - |
dc.identifier.uri | http://hdl.handle.net/10722/283987 | - |
dc.description.abstract | This study assesses a new mechanism — the deposit channel — in the transmission of interest rate shock to household consumption using an administrative panel dataset of financial transactions for Turkey. Our empirical strategy exploits variation in consumer's adherence to the Muslim laws that forbid earning interest and employs a standard difference-in-difference design. Following an unanticipated announcement of interest rate hike, rate-sensitive consumers significantly reduce their overall spending and the response persists throughout the post-announcement period. The response of debt payment, disparate exposure to inflation, and exchange rate, the demographic difference can hardly fully account for the documented consumption response heterogeneity. | - |
dc.language | eng | - |
dc.publisher | MIT Press. The Journal's web site is located at http://mitpress.mit.edu/restat | - |
dc.relation.ispartof | The Review of Economics and Statistics | - |
dc.rights | The Review of Economics and Statistics. Copyright © MIT Press. | - |
dc.subject | Interest Rate Shock | - |
dc.subject | Consumption | - |
dc.subject | Big Data | - |
dc.subject | Household Finance | - |
dc.subject | Banking | - |
dc.title | Interest Rate Pass-Through and Consumption Response: The Deposit Channel | - |
dc.type | Article | - |
dc.identifier.email | Zhang, J: zhangj1@HKUCC-COM.hku.hk | - |
dc.identifier.authority | Zhang, J=rp02698 | - |
dc.description.nature | postprint | - |
dc.identifier.doi | 10.1162/rest_a_00941 | - |
dc.identifier.scopus | eid_2-s2.0-85120953091 | - |
dc.identifier.hkuros | 310798 | - |
dc.identifier.volume | Epub 2020-06-19 | - |
dc.identifier.isi | WOS:000727676900008 | - |
dc.publisher.place | United States | - |
dc.identifier.ssrn | 2913973 | - |
dc.identifier.issnl | 0034-6535 | - |