Interest Rates and the Market for New Light Vehicles
Copyright policy )Interest Rates and the Market for New Light Vehicles
AbstractWe study the impact of interest rate changes on the demand and supply of new light vehicles in an environment where consumers and manufacturers face their own interest rates. Interest rate changes impact the auto market through both households and manufacturers. For the impact of rate changes on price and output growth, the household channel is quantitatively more important. A 100 basis‐point increase in both interest rates causes annual growth rates of production to fall from 1.0% to −11.0% and sales to fall from 1.0% to −2.9% in the short run.
- International Business School Bulgaria
- Federal Reserve Bank of New York United States
- Johns Hopkins University United States
- Federal Reserve System United States
- Brandeis University United States
automobiles, ddc:330, inventories, interest rates; automobiles; inventories; Bayesian maximum likelihood, E44, G31, interest rates, automobiles, inventories, Bayesian maximum likelihood, interest rates, Bayesian maximum likelihood, jel: jel:E44, jel: jel:G31
automobiles, ddc:330, inventories, interest rates; automobiles; inventories; Bayesian maximum likelihood, E44, G31, interest rates, automobiles, inventories, Bayesian maximum likelihood, interest rates, Bayesian maximum likelihood, jel: jel:E44, jel: jel:G31
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