Christian Keuschnigg and Michael Kogler, (2019), “Trade and innovation: The Schumpeterian role of banks”, VoxEU, 4 March
Only strong banks can fulfil their Schumpeterian role by efficiently reallocating credit. The column argues that high capital standards, efficient bankruptcy laws, and a lower cost of bank equity improve credit reallocation and thereby support the productive specialisation of the economy. An efficient banking sector also magnifies the gains from trade liberalisation by easing the process of capital reallocation.
Relevant Posts
- Peter Hoffmann, (2019), «Interest rate risk in the euro area», ECB Research Bulletin No. 55, 22 February
- Maria Demertzis, Inês Goncalves Raposo, Pia Hüttl and Guntram B. Wolff, (2018), «How to provide liquidity to banks after resolution in Europe’s banking union», European Parliament, Committee on Economic and Monetary Affaris, 22 November