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Transparency in Central Bank and Credit Expansion: Empirical Evidence from Asian Countries

Author

Listed:
  • Saeed Sazzad Jeris

    (Shahjalal University of Science & Technology, Sylhet, Bangladesh)

  • Omar Bari Md. Ibrahim

    (University of Windsor, Windsor, Ontario, Canada)

  • Ferdous Ahmed Chowdhury

    (Fairleigh Dickinson University, Vancouver, British Columbia, Canada)

  • Humaira Begum

    (Hajee Mohammad Danesh Science and Technology University, Dinajpur, Bangladesh)

Abstract

This research investigated the influence of central bank transparency on credit expansion in 15 Asian nations (both advanced and emerging) during the period from 2000 to 2019. Panel OLS and Dynamic GMM estimation are used to identify the impact of central bank transparency on the credit spread. The findings indicate that central bank transparency plays a crucial role in lowering credit spreads and facilitating credit expansion. In addition, the influence of central bank transparency on credit spreads has a greater effect in emerging economies than in developed economies, highlighting the significance of transparency for tackling information asymmetry within the credit system. Overall, the research highlights the significance of central bank independence in reducing knowledge disparities and promoting a more transparent credit environment.

Suggested Citation

  • Saeed Sazzad Jeris & Omar Bari Md. Ibrahim & Ferdous Ahmed Chowdhury & Humaira Begum, 2024. "Transparency in Central Bank and Credit Expansion: Empirical Evidence from Asian Countries," Journal of Central Banking Theory and Practice, Central bank of Montenegro, vol. 13(3), pages 271-289.
    • Handle: RePEc:cbk:journl:v:13:y:2024:i:3:p:271-289
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    More about this item

    Keywords

    Central bank transparency; credit spread; Asia; GMM; OLS.;
    All these keywords.

    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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