Journal of Finance and Investment Analysis

The bank lending channel and lunar phases: Evidence from a panel of European banks

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  • Abstract

    While many studies have demonstrated the impact of weather conditions along with lunar phases on stock markets, this paper explores the impact of lunar phases on the bank lending channel for a sample of European banks, using the GMM estimator methodology, suggested in Arellano and Bond (1991), spanning the period 1994-2010. The results indicate that lunar phases have a statistically significant effect on the size of this type of monetary policy transmission mechanism, which is also dependent on the size of banking institutions.