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Is there a financial accelerator in US banking?: Evidence from the cyclicality of banks' price-cost margins

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  • Aliaga-Díaz, Roger
  • Olivero, María Pía

Abstract

We show that price-cost margins for US banks are consistently countercyclical, even after controlling for credit risk, the term structure of interest rates and monetary policy. This evidence supports the existence of a "financial accelerator" in US banking.

Suggested Citation

  • Aliaga-Díaz, Roger & Olivero, María Pía, 2010. "Is there a financial accelerator in US banking?: Evidence from the cyclicality of banks' price-cost margins," Economics Letters, Elsevier, vol. 108(2), pages 167-171, August.
    • Handle: RePEc:eee:ecolet:v:108:y:2010:i:2:p:167-171
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    References listed on IDEAS

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    3. Bernanke, Ben S. & Gertler, Mark & Gilchrist, Simon, 1999. "The financial accelerator in a quantitative business cycle framework," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 21, pages 1341-1393, Elsevier.
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    7. Coleman, Wilbur John, II, 1995. "Inside Money, Outside Money, and Short-Term Interest Rates: Comment," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 27(4), pages 1387-1396, November.
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