Goodhart, Charles A. E.; Tsomocos, Dimitrios P. - Institute for Monetary and Economic Studies, Bank of Japan - 2011
What is the main limitation of much modern macro-economic theory, among the failings pointed out by William R. White at the 2010 Mayekawa Lecture? We argue that the main deficiency is a failure to incorporate the possibility of default, including that of banks, into the core of the analysis....
