The financial crises of 2007-2008 and the subsequent worldwide recession show the importance of exploring the correlation between financial and real crises. Starting from a new estimation of the Italian business cycle (Bartoletto et al., 2017), we analyze the linkage between banking crises and the business and credit cycle in Italy over the last two centuries, distinguishing between slowdown and inner-banking crises. The vast literature on banking crises in Italy is dominated by the narrative approach. In this work we aim to advance the argument one step further by integrating the narrative approach with an empirical VAR analysis to evaluate the real impact of banking crises. Our long-run analysis proves that not all the banking crises have a connection with real activity and that not all the crises occurring close to a GDP contraction were associated to a boom-bust mechanism.
|Titolo:||Banking crises and business cycle: evidence for Italy (1861-2016)|
MARZANO, ELISABETTA (Corresponding)
|Data di pubblicazione:||2018|
|Appare nelle tipologie:||1.1 Articolo in rivista|