The effects of credit supply shocks on Malaysia's economy
This study has examined the impacts of credit supply shocks and other common economic shocks (aggregate demand & supply and monetary shocks) on Malaysia's macroeconomic variables, using the Bayesian structural vector autoregressive (SVAR) model and employing sign restrictions. The results...
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| Format: | Article |
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University Putra Malaysia
2022
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| author | Khair Afham, M. S. M. Rosland, Anitha |
| author_facet | Khair Afham, M. S. M. Rosland, Anitha |
| author_sort | Khair Afham, M. S. M. |
| collection | UPM |
| description | This study has examined the impacts of credit supply shocks and other common economic shocks (aggregate demand & supply and monetary shocks) on Malaysia's macroeconomic
variables, using the Bayesian structural vector autoregressive (SVAR) model and employing sign restrictions. The results showed that an expansionary credit supply shock positively affected the Malaysian economy, consistent with the existing literature. Based on the variance decomposition finding, credit supply shocks explained a significant portion of the anticipated variation in the GDP growth, inflation, and, most importantly, credit growth in Malaysia. This study further decomposed total private non-financial corporate loans into two components: households and non-financial firms. Unlike other economies that have extensively researched this subject matter (US, UK, Euro Area), the growth rate of households and non-financial firms differed greatly in Malaysia. The empirical findings revealed considerable distinctions between these two components, indicating that different treatments or policy formulations are required rather than employing the same policy to boost or govern Malaysia's credit market. |
| first_indexed | 2024-03-06T11:18:42Z |
| format | Article |
| id | upm.eprints-103531 |
| institution | Universiti Putra Malaysia |
| last_indexed | 2024-03-06T11:18:42Z |
| publishDate | 2022 |
| publisher | University Putra Malaysia |
| record_format | dspace |
| spelling | upm.eprints-1035312023-05-23T02:20:11Z http://psasir.upm.edu.my/id/eprint/103531/ The effects of credit supply shocks on Malaysia's economy Khair Afham, M. S. M. Rosland, Anitha This study has examined the impacts of credit supply shocks and other common economic shocks (aggregate demand & supply and monetary shocks) on Malaysia's macroeconomic variables, using the Bayesian structural vector autoregressive (SVAR) model and employing sign restrictions. The results showed that an expansionary credit supply shock positively affected the Malaysian economy, consistent with the existing literature. Based on the variance decomposition finding, credit supply shocks explained a significant portion of the anticipated variation in the GDP growth, inflation, and, most importantly, credit growth in Malaysia. This study further decomposed total private non-financial corporate loans into two components: households and non-financial firms. Unlike other economies that have extensively researched this subject matter (US, UK, Euro Area), the growth rate of households and non-financial firms differed greatly in Malaysia. The empirical findings revealed considerable distinctions between these two components, indicating that different treatments or policy formulations are required rather than employing the same policy to boost or govern Malaysia's credit market. University Putra Malaysia 2022 Article PeerReviewed Khair Afham, M. S. M. and Rosland, Anitha (2022) The effects of credit supply shocks on Malaysia's economy. International Journal of Economics and Management, 16 (2). 257 - 270. ISSN 1823-836X http://www.ijem.upm.edu.my/vol16no2.htm 10.47836/ijeam.16.2.08 |
| spellingShingle | Khair Afham, M. S. M. Rosland, Anitha The effects of credit supply shocks on Malaysia's economy |
| title | The effects of credit supply shocks on Malaysia's economy |
| title_full | The effects of credit supply shocks on Malaysia's economy |
| title_fullStr | The effects of credit supply shocks on Malaysia's economy |
| title_full_unstemmed | The effects of credit supply shocks on Malaysia's economy |
| title_short | The effects of credit supply shocks on Malaysia's economy |
| title_sort | effects of credit supply shocks on malaysia s economy |
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