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Money Markets, Collateral and Monetary Policy
De Fiore, Fiorella - 2018
unsecured lending and substantial increases in haircuts on posted collateral. This paper seeks to understand the implications of …
Persistent link: https://www.econbiz.de/10012480970
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Two Monetary Tools : Interest Rates and Haircuts
Ashcraft, Adam - 2010
We study a production economy with multiple sectors financed by issuing securities to agents who face capital constraints. Binding capital constraints propagate business cycles, and a reduction of the interest rate can increase the required return of high-haircut assets since it can increase the...
Persistent link: https://www.econbiz.de/10012462319
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Financial Constraints, Asset Tangibility, and Corporate Investment
Almeida, Heitor - 2006
When firms are able to pledge their assets as collateral, investment and borrowing become endogenous: pledgeable assets … between capital spending and cash flows is non-monotonic in the firm's asset tangibility. Our theory allows us to use a …
Persistent link: https://www.econbiz.de/10012466582
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The Effect of Income and Collateral Constraints on Residential Mortgage Terminations
Archer, Wayne - 1995
classical option theory. A substantial literature has emerged examining the problem, focusing on the characteristics of the … behavior, using both householder characteristics and collateral (house) value. Second, it empirically recognizes important … interactions between the status of the prepayment option and the influence of income and collateral constraints upon prepayment …
Persistent link: https://www.econbiz.de/10012473699
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Conventional and Unconventional Monetary Policy with Endogenous Collateral Constraints
Araújo, Aloísio - 2013
nominal interest rate), in a general-equilibrium model of asset pricing and risk sharing with endogenous collateral … constraints of the kind proposed by Geanakoplos (1997). The existence of collateral constraints allows our model to capture the …-bank purchases raise the price of the asset, owing to binding collateral constraints, the effects need not be the ones commonly …
Persistent link: https://www.econbiz.de/10012458952
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Savings and the Terms of Trade Under Borrowing Constraints
Agenor, Pierre-Richard - 2000
This paper examines the extent to which permanent terms-of-trade shocks have an asymmetric effect on private savings. The first part uses a simple three-period model to show that, if households expect to face binding borrowing constraints in bad states of nature, savings rates will respond...
Persistent link: https://www.econbiz.de/10012471007
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Financial Frictions and the Wealth Distribution
Fernández-Villaverde, Jesús - 2019
particular, we find that the recovery after a negative aggregate shock is more sluggish when the economy is more leveraged …
Persistent link: https://www.econbiz.de/10012480247
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Leverage Constraints and the International Transmission of Shocks
Devereux, Michael B. - 2010
Recent macroeconomic experience has drawn attention to the importance of interdependence among countries through financial markets and institutions, independently of traditional trade linkages. This paper develops a model of the international transmission of shocks due to interdependent...
Persistent link: https://www.econbiz.de/10012462429
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Leverage, Moral Hazard and Liquidity
Acharya, Viral V. - 2010
the asset shock and the system-wide distribution of leverage. This distribution of leverage is, however, itself endogenous …
Persistent link: https://www.econbiz.de/10012462815
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Liquidity and Trading Dynamics
Guerrieri, Veronica - 2007
How do financial frictions affect the response of an economy to aggregate shocks? In this paper, we address this question, focusing on liquidity constraints and uninsurable idiosyncratic risk. We consider a search model where agents use liquid assets to smooth individual income shocks. We show...
Persistent link: https://www.econbiz.de/10012465449