Can Italy grow out of its NPL overhang? A panel threshold analysis
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Mohaddes, K., Raissi, M., & Weber, A. (2017). Can Italy grow out of its NPL overhang? A panel threshold analysis. Economics Letters, 159 185-189. https://doi.org/10.1016/j.econlet.2017.08.001
This paper examines whether a tipping point exists for real GDP growth in Italy above which the ratio of non-performing loans (NPLs) to total loans falls significantly. Estimating a heterogeneous dynamic panel–threshold model with data on 17 Italian regions over the period 1997–2014, we find that growth above 1.2%, if sustained for a number of years, is associated with a significant decline in the NPL ratio.
Italy, non-performing loans, growth, panel tests of threshold effects
External DOI: https://doi.org/10.1016/j.econlet.2017.08.001
This record's URL: https://www.repository.cam.ac.uk/handle/1810/269977