We present a model with heterogeneous firms, in which credit constraints may give rise to self-fulfilling, sunspot … constrained by expected equity value. Interactions between debt and equity value made possible by credit constraints generate a … credit externality, which leads to procyclical total factor productivity (TFP) and, with sufficiently high cost of financial …

Previous studies on financial frictions have been unable to establish the empirical significance of credit constraints … in macroeconomic fluctuations. This paper argues that the muted impact of credit constraints stems from the absence of a … and we allow productive agents to be credit-constrained. A combination of these two features enables our model to …

Managing the credit risk inherent to a corporate credit line is similar to that of a term loan, but with one key … default (LGD). However, since a credit line allows the borrowers to draw down the committed funds according to their own needs … corporate lending within Spain over the last 20 years, provides the most comprehensive overview of corporate credit line use and …

as by the IIF (1998) and ISDA (1998), argue that credit risk models should also be used to determine risk … accuracy of the model's forecasts of credit losses. A serious impediment to such model validation is the small number of … forecasts available due to the long planning horizons typical of credit risk models. Using a panel data approach, we propose …