The Financial Accelerator in Europe after the Financial Crisis

Abstract

The paper investigates the mechanism of a financial accelerator. In particular, it examines the procyclicality of credit margins in Europe after the financial crisis, with an additional split to small, medium and large-sized banks. The empirical analysis is in contrast with contemporary authors because approve that financial accelerator is not present on the European market after financial crisis. It could be caused by multiple factors, for example structural changes during financial crisis, change in the behaviour of commercial banks or extremely low interest rates. We tested our hypothesis on dataset consists of a data panel with annual data for the period 1998-2015 and includes 2 489 banks from 36 European countries from the Bankscope database. We also provide empirical robust proof that such behaviour is not occurring during the financial crisis and after the financial crisis in the European banking system.

Presenting a model for evaluating the performance of financial accelerators of companies accepted on the Iranian Stock

“…This boosting mechanism is called the "financial accelerator". The key idea of a financial accelerator is to show that economic shocks to companies' net valuable increase their credit standing (Baková, 2018). In fact, the effect of financial acceleration is that a change in macroeconomic activity causes a change in the net wealth of enterprises economic, due to the positive correlation between the two variables (for example, due to the cyclical agreement between profit and asset prices).…”