Working Papers present research work by both Danmarks Nationalbank’s employees and our partners. Working Papers are primarily targeted at professionals and people with an interest in central banking research as well as economics and finance in a broader sense.
Real Effects of Credit Supply Shocks: Evidence from Danish Banks, Firms, and Workers
We investigate the effects of credit supply contractions on employment beyond firm-level aggregates. We show that banks exposed to the 2008-09 financial crisis reduced lending to firms. This led to a drop in firm-level employment, concentrated among firms with low liquidity, and on employment of low-educated and nonmanagerial workers.