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 …

unsecured lending and substantial increases in haircuts on posted collateral. This paper seeks to understand the implications of …

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 …

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 …

In a model with housing collateral, a decrease in house prices reduces the collateral value of housing, increases … household exposure to idiosyncratic risk, and increases the conditional market price of risk. This collateral mechanism can …. The increase of the conditional equity premium and Sharpe ratio when collateral is scarce in the model matches the …

In a model with housing collateral, the ratio of housing wealth to human wealth shifts the conditional distribution of … asset prices and consumption growth. A decrease in house prices reduces the collateral value of housing, increases household …

when compared with collateral-constrained models. Our results do not depend on the specification of the collateralized …

constrained-efficient allocation. The key as in general equilibrium theory is to extend the commodity space in such a way that …