Skip to Main Content

News Releases

Economic Brief

Oct. 14, 2020

Richmond Fed Studies How Small Business Finance and Monetary Policy Interact

The Richmond Fed’s latest Economic Brief analyzes how monetary policy affects lending relationships for small businesses and vice versa.

Bank loans are an important funding source for small businesses, but access to loans depends on lending relationships with banks. The researchers develop a search model that analyzes the supply and demand for lending relationships. Understanding the key role these relationships play in the economy can help central banks develop optimal monetary policy responses to crises like the Great Recession and COVID-19.

The Richmond Fed’s Economic Brief series provides essays on economic issues and trends. Sign up to receive an email notification when a new essay is posted.


As part of our nation’s central bank, the Richmond Fed is one of 12 regional Reserve Banks working together with the Board of Governors to support a healthy economy and deliver on our mission to foster economic stability and strength. We connect with community and business leaders across the Fifth Federal Reserve District — including the Carolinas, District of Columbia, Maryland, Virginia, and most of West Virginia — to monitor economic conditions, address issues facing our communities, and share this information with monetary and financial policymakers. We also work with banks to ensure they are operating safely and soundly, supply financial institutions with currency that’s fit for distribution, and provide a safe and efficient way to transfer funds through our nation’s payments system.

###

Subscribe to News

Receive an email notification when News is posted online:

phone Contact Us

Jim Strader (804) 697-8956 (804) 332-0207 (mobile)