10.17863/CAM.12186
Mohaddes, Kamiar
0000-0002-2501-2062
Raissi, M
Weber, A
Can Italy Grow Out of Its NPL Overhang? A Panel Threshold Analysis
Apollo - University of Cambridge Repository (staging)
2017
Italy
non-performing loans
growth
panel tests of threshold effects
Apollo - University of Cambridge Repository (staging)
Apollo - University of Cambridge Repository (staging)
2017-10-01
Article
0165-1765
1873-7374
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.