robustly destroys competitive equilibrium. The need for collateral would seem to cause under-investment. Our analysis … illustrates a countervailing force: goods that serve as collateral yield additional services and are therefore over-valued and … over-produced. In models without cash flow problems there is never marginal under-investment on collateral. …

think about default, collateral, and leverage as the central features of the financial/macro economy, despite their complete …

Much of the lending in modern economies is secured by some form of collateral: residential and commercial mortgages and … goods, collateralized securities and the possibility of default to argue that the reliance on collateral to secure loans and … the particular collateral requirements chosen by the social planner or by the market have a profound impact on prices …

going around the banks and lending at lower collateral rates (not lower interest rates), and when necessary it must inject … interest rates and ignored collateral. …

subsequently materialize. Introducing default and limited collateral into general equilibrium theory (GE) allows for a theory of …

Introducing default and limited collateral into general equilibrium theory (GE) allows for a theory of endogenous …