Capital Market Frictions, Business Cycle and Monetary Transmission

Empirical evidence shows that some firms may be capital constraint because of capital market imperfections. We therefore extend the business cycle models with frictions `a la Pissarides on the labour market by also introducing symmetric frictions on the capital market. We show that the capital market frictions (and their interactions with the labour market frictions) improve the statistical properties of the model and generate a financial accelerator.

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Year of publication:	2005-02
Authors:	Pierrard, Olivier
Institutions:	de Nederlandsche Bank
Subject:	capital market frictions \| business cycle \| monetary transmission

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Extent:	application/pdf
Series:	DNB Working Papers.
Type of publication:	Book / Working Paper
Language:	English
Classification:	E13 - Neoclassical ; E24 - Employment; Unemployment; Wages ; E51 - Money Supply; Credit; Money Multipliers
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005030212