The aim of this paper is to provide evidence of the existence of an endogenous credit rationing channel after liberalisation of the financial market in Malaysia. The results found some empirical evidence to support the fact that the loan market predominantly exhibited excess demand in the post-liberalisation period. Even though the supply of loans was responsive to interest rates, there was no empirical evidence to support the presence of an excess supply of loans. This latter factor suggested that the supply of loans was determined by the banking institutions themselves in support of the endogenous credit rationing characteristic.
|Number of pages||18|
|Journal||Singapore Economic Review|
|Publication status||Published - 1998|
ASJC Scopus subject areas
- Economics and Econometrics