This paper looks at the effect of credit constraints on skill acquisition when agents have heterogeneous abilities and … wealth. We use a two factor general equilibrium model and assume credit markets are absent. We explore the effects of trade …

Firms in developing countries cite credit constraints as one of their primary obstacles to investment. Direct foreign … investment, by bringing in scarce capital, may ease domestic firms' credit constraints. Alternatively, if foreign firms borrow … heavily from domestic banks, they may exacerbate domestic firms' credit constraints by crowding them out of domestic capital …

We examine how credit constraints affect the cyclical behavior of productivity-enhancing investment and thereby …, thus mitigating volatility. But when firms face tight credit constraints, long-term investment turns procyclical, thus … volatility and growth. We first develop a simple growth model where firms engage in two types of investment: a short-term one and …

in both credit and labor markets to study the aggregate and micro-level implications of a credit crunch--i.e., a … tightening of collateral constraints. When we simulate a credit crunch calibrated to match the observed decline in the ratio of … decline in output--explained by a drop in aggregate total factor productivity and investment--and a protracted increase in …

We argue that positive co-movements between land prices and business investment are a driving force behind the broad … incorporating two key features into a DSGE model: We introduce land as a collateral asset in firms' credit constraints and we … joint dynamics of land prices and business investment …

used during a credit boom to reduce the expected costs of a financial crisis …

We show that supply-side financial shocks have a large impact on firms' investment. We develop a new methodology to … of aggregate loan and investment fluctuations …

Which is the tighter constraint on private sector investment: weak property rights or limited access to external …

extraordinary growth of exports and foreign domestic investment (FDI). The key to the Mexican puzzle lies in Mexico's response to … crisis: a deterioration in contract enforceability and an increase in nonperforming loans. As a result, the credit crunch in … Mexico has been far deeper and far more protracted than in the typical developing country. The credit crunch has hit the …