Giannone, Domenico, Lenza, Michele, Pill, Huw and Reichlin, Lucrezia, The ECB and the Interbank Market (November 20, 2012). ECB Working Paper No. 1496. Available at SSRN
“We analyse the impact on the euro area economy of the European Central Bank’s (ECB) non-standard monetary policy measures by studying the effect of the expansion of intermediation of interbank transactions across the central bank balance sheet. We exploit data drawn from the aggregated Monetary and Financial Institutions (MFI) balance sheet, which allows us to construct a measure of the policy shock represented by the ECBs increasing role as a financial intermediary. We find small but significant effects both on loans and real economic activity.”
