Uncertainty and Demand for Business Loans: A Study of Selected Countries in the Euro Area
This paper studies the effect of uncertainty shocks on the demand for business loans in individual euro area countries. The results of Bayesian vector autoregression (VAR) model impulse response functions show that in some countries the overall demand for business loans, and particularly the demand for business loans for fixed-investment financing, respond significantly negatively to the shock.
Keywords: Demand for business loans, Uncertainty, Bayesian VAR.
JEL: D81, E32, E44.