The Impact of Quantitative Easing on UK Bank Lending: Why Banks Do Not Lend to Businesses?

The growing proportion of UK bank lending to the financial sector reached a peak in 2007 just before the onset of the Global Financial Crisis (GFC). This marks a trend in the dwindling amount of bank lending to private sector non-financial corporations (PNFCs), which was exacerbated with the Great Recession. Many central banks aimed to revive bank lending with quantitative easing (QE) and unconventional monetary policy. We propose an agent based computational economics (ACE) model which combines the main factors in the economic environment of QE and Basel regulatory framework to analyse why UK banks do not prioritize lending to non-financial businesses. The lower bond yields caused by QE encourage big firms to substitute away from bank borrowing to bond issuance. In addition, the risk weight regime of Basel I/II on capital induces banks to favour mortgages over business loans to small and medium enterprises (SMEs). The combination of lower bond yields and Basel II/III capital requirements on banks, which, respectively, impact demand and supply of credit in the UK, plays a role in the drop of bank loans to businesses. The ACE model aims to reinstate policy regimes that form constraints and incentives for the behaviour of market participants to provide the causal factors in observed macro-economic phenomena

Conduct disorder in girls: neighborhoods, family characteristics, and parenting behaviors

<p>Abstract</p> <p>Background</p> <p>Little is known about the social context of girls with conduct disorder (CD), a question of increasing importance to clinicians and researchers. The purpose of this study was to examine the associations between three social context domains (neighborhood, family characteristics, and parenting behaviors) and CD in adolescent girls, additionally testing for race moderation effects. We predicted that disadvantaged neighborhoods, family characteristics such as parental marital status, and parenting behaviors such as negative discipline would characterize girls with CD. We also hypothesized that parenting behaviors would mediate the associations between neighborhood and family characteristics and CD.</p> <p>Methods</p> <p>We recruited 93 15–17 year-old girls from the community and used a structured psychiatric interview to assign participants to a CD group (n = 52) or a demographically matched group with no psychiatric disorder (n = 41). Each girl and parent also filled out questionnaires about neighborhood, family characteristics, and parenting behaviors.</p> <p>Results</p> <p>Neighborhood quality was not associated with CD in girls. Some family characteristics (parental antisociality) and parenting behaviors (levels of family activities and negative discipline) were characteristic of girls with CD, but notll. There was no moderation by race. Our hypothesis that the association between family characteristics and CD would be mediated by parenting behaviors was not supported.</p> <p>Conclusion</p> <p>This study expanded upon previous research by investigating multiple social context domains in girls with CD and by selecting a comparison group who were not different in age, social class, or race. When these factors are thus controlled, CD in adolescent girls is not significantly associated with neighborhood, but is associated with some family characteristics and some types of parental behaviors. However, the mechanisms underlying these relationships need to be further investigated. We discuss possible explanations for our findings and suggest directions for future research.</p