The thesis is constructed around two themes. In the first part, we review the main workhorse macroeconomic models emphasizing a role for financial frictions in business cycle fluctuations. Their main contributions was to develop the two concepts of the external finance premium and asset collateral value (Bernanke and Gertler, 1989; Kiyotaki and Moore, 1997) and to theorize the organization of the financial sector, therefore providing new insights into the nature of intermediation spreads and capital solvency ratios (Holmstrom and Tirole, 1997; Gertler and Kiyotaki, 2011). We investigate the interaction between inflation dynamics and the financial accelerator effect in the model Bernanke, Gertler and Gilchrist (1999) and show that the magnitude of the financial accelerator effect depends crucially on the slope of the Phillips curve. In particular, the flatter the Philips curve, the stronger is the financial accelerator effect. In the second, empirical part, we first investigate the risk-taking channel of monetary policy using US bank lending survey data over the 17 years that preceded the 2007-2009 financial crisis. We find robust evidence that an expansionary monetary policy led to an immediate tightening of bank lending standards followed by a subsequent loosening as predicted by recent theories of bank risk-taking. In addition, the term spread may play a pivotal role in this transmission mechanism. Finally, we empirically investigate the hypothesis that financial conditions critically affect the ability of commercial banks to hedge liquidity shocks. Using US commercial banks' balance sheet data over the period 1990-2007, we show that the CP-Tbill spread can help identify regimes where this hedge is effective in protecting bank loan supply from adverse financial market conditions using nonlinear methods.