02124cas a2200253 a 4500 AALejournalIMF015460 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513581262 1018-5941 BD-DhAAL BD-DhAAL Igan, Deniz. Capital Inflows, Credit Growth, and Financial Systems / Deniz Igan, Zhibo Tan. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (31 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Exploiting a granular panel dataset that breaks down capital inflows into FDI, portfolio and other categories, and distinguishes between credit to the household sector and to the corporate sector, we investigate the association between capital inflows and credit growth. We find that non-FDI capital inflows boost credit growth and increase the likelihood of credit booms in both household and corporate sectors. For household credit growth, the composition of capital inflows appears to be more important than financial system characteristics. In contrast, for corporate credit growth, both the composition and the financial system matter. Regardless of sectors and financial systems, net other inflows are always linked to rapid credit growth. Firm-level data corroborate these findings and hint at a causal link: net other inflows are related to more rapid credit growth for firms that rely more heavily on external financing. Further explorations on how capital flows translate into more credit indicate that both demand and supply side factors play a role. Mode of access: Internet Tan, Zhibo. IMF Working Papers; Working Paper ; No. 2015/193 Full text available on IMF http://elibrary.imf.org/view/journals/001/2015/193/001.2015.issue-193-en.xml IMF e-Library